January 2006
CENTRAL CAMBRIA BUILDERS ASSOCIATION ADVERTISE IN THIS NEWSLETTER Advertise here, and you direct your advertising dollars towards local businesses involved in the local Home Building Industry. If you are interested please complete our Newsletter Advertising Contract and fax it to us (see attachment). Our newsletter goes out to approximately 300 businesses.
HOUSING
MARKET FUNDAMENTALLY HEALTHY A record year for Single-family home construction is expected. �The housing market still is fundamentally healthy,� said Dave Wilson, president of NAHB. �Many builders sense some tapering off of buyer demand because of resistance to high prices and rising interest rates.� �Measures of housing affordability have deteriorated in recent months, but economic fundamentals are still quite solid� asys NAHB Chief Economist David Seiders. �2005 will be a record year for single-family housing and the second best year for total housing starts, exceeded only in 1972.�
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TAX
REFORM PLAN ATTACKS Homeowners
across the country rely on tax breaks and incentives to realize their
dream of homeownership. Under
current law, interest payments on mortgage debt of up to $1.1 million are
deductible, including $100,000 for home equity loans.
Thirty-seven million households deducted mortgage interest in 2004,
saving $70 billion in taxes. On
November 1, the President�s Advisory Panel recommended overhauling the
tax system. They proposed
replacing the mortgage interest deduction with a much more limited home
credit equal to 15% of the interest paid on a principal residence. The plan would also eliminate deductions for state and local taxes (including property taxes) and interest deductions for home equity loans and second homes. The hardest hit families are those that bought their homes during the past 3 years when prices were going up. Virtually all of them were counting on the mortgage interest deduction to reduce their housing costs to more affordable levels. In addition, millions of other families have refinanced their mortgage to remodel their homes, to send children to college, to cover medical expenses, or to pay off consumer credit card debt. This is mostly middle-class Americans. This plan would cause home values to fall and demand for housing is likely to slow. According to a nationwide survey of 1,001 adults found, Americans oppose, by 2-1 margin, recommendations to �simplify� the tax code by eliminating federal tax deductions for property taxes and mortgage interest. Statistics also showed that nearly 4 in 5 respondents believe the government should support homeownership through tax incentives.
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