NAHB Says Housing Still Hurt by Financial Markets
Washington, DC, March 12, 2009--The National Association of Home Builders told Congress that the housing sector is still being significantly affected by the upheaval in the financial and mortgage markets that started in 2007, and there is deep concern that these financial dislocations will increase the depth and length of the housing downturn.
Testifying before the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, NAHB Chairman Joe Robson, a builder from Tulsa, Okla., said that coordinated regulatory efforts among federal and state agencies are necessary to ensure prudent lending practices and effective consumer protections while facilitating efficient operation of the residential mortgage markets.
“NAHB supports efforts to ensure that mortgage lending occurs in a safe and sound manner and that abuses in lending practices are properly addressed,” said Robson.
“However, it is imperative that any steps taken in this effort do not inadvertently or unnecessarily disrupt the mortgage lending process or consumer financing options, or increase the costs or reduce the availability of mortgage credit.”
NAHB urged Congress to implement a clear national framework for mortgage origination standards to replace the current patchwork of state and local laws, which often lead to unnecessary restrictions on mortgage credit.
“Specifically, Congress should establish a federal pre-emption statute creating essential uniformity in mortgage market standards,” said Robson.
NAHB also supports efforts to improve consumer education on financing and owning a home and believes it is important that efforts to ensure prudent mortgage lending and risk management practices as well as adequate consumer disclosures are comprehensive and uniform for all organizations involved in providing mortgage credit.
Single-family appraisal problems are an area of concern for home builders, and are contributing to the current housing and credit crisis. “Appraisers have often used sales of homes in foreclosure or other distressed property sales as comparables for appraisals of new homes without making the appropriate value adjustments,” said Robson.