A few hours ago, the House of Representatives voted to approve a spending package that will fund the federal government through fiscal year 2020. The bill is expected to pass the Senate this week and President Trump has pledged to sign the bill by Friday to avert a government shutdown.
In the lead up to its introduction, NAR was able to secure the inclusion of three critical items for the housing industry that will bring certainty and stability to the market as we head into the New Year:
9-Month Extension of the National Flood Insurance Program (NFIP) through September 30, 2020
- Extension of various critical tax provisions through December 31, 2020 and retroactive to 2018
- 7-Year Reauthorization of the Terrorism Risk Insurance Program Reauthorization (TRIP) through December 31, 2027
National Flood Insurance Program (NFIP)
NAR is pleased to see a 9-month program extension worked through Congress with little fanfare. While the agreement will ensure NFIP policies can be issued and renewed through the end of the fiscal year, we will continue to push lawmakers to use the afforded time to find compromise on a longer term reauthorization and reform package.
As we know all too well, this program has operated on a string of short-term extensions and endured multiple lapses over the past two years. From Montana to Mississippi and everywhere in between, that unpredictability has put home sales in jeopardy and left insurance policies in limbo. While NAR research has shown that NFIP lapses threaten 1,300 transactions each day, the resulting uncertainty impacts our nation's overall housing market and economic stability.
NAR has strongly supported the NFIP Reauthorization Act, also authored by Chairwoman Maxine Waters (CA-43), which includes a 5-year program reauthorization along with reforms to improve mapping, enhance mitigation, and remove obstacles to private flood insurance. H.R. 3167 is the product of extensive bipartisan negotiations between Waters and House Financial Services Committee Ranking Member Patrick McHenry (NC-10), striking a delicate balance between NFIP sustainability and affordability. This legislation unanimously passed the Committee in June and we will maintain our call for lawmakers to work through the legislation this congress.
Also, included in the sending package are temporary extensions of three tax provisions directly impacting our industry:
1) the exclusion of forgiven mortgage debt from gross income, meaning that owners of primary residences who sold them short and had part of their mortgage debt written off will not have to pay tax on the amount forgiven;
2) the deductibility of premiums for mortgage insurance; and
3) the deduction of the cost of improvements to commercial buildings that make them energy efficient.
These provisions had all expired at the end of 2017, but the bill extends them, retroactive to the beginning of 2018, and through the end of 2020.
Terrorism Risk Insurance Program (TRIP)
Finally, NAR scored a major victory, primarily for our commercial members, with the inclusion of the seven-year re-authorization of the Terrorism Risk Insurance Program in the spending package.
Terrorism risk insurance is often required to secure necessary financing for the thousands of commercial practitioners nationwide. Absent TRIP, the country would likely see a repeat of what happened in 2001, when many insurers raised terrorism risk insurance to unsustainable prices or stopped offering coverage entirely.
NAR repeatedly called on Congress to reauthorize TRIP before its scheduled expiration in 2020, publicly supporting Chairwoman Maxine Waters’ Terrorism Risk Insurance Program Re-authorization Act of 2019.
You may click here for the full statement released this afternoon from NAR President Vince Malta and a summary of these legislative alerts for social media.
NAR News from Washington
NAR Meets with Interior Secretary
Secretary David Bernhardt mentioned a couple of specific efforts the Department is taking to reduce regulatory burdens on housing and the real estate sector. Click here for more.
NAR Supports Group of Five Credit Scoring and Student Loan Bills
NAR sent a letter of support to the House Financial Services Committee (HFSC) Chairs for a group of bills, to be marked by the committee, impacting federal policy in credit policy and student loan debt. Click here for more.
2020 FHA Loan Limits Published
FHA published its 2020 loan limits on December 3, 2019. The high cost limit is now at $765,600, while the lowest FHA limit rose to $331,760. Click here for more.
Loan Limits Increase in 2020
The Federal Housing Finance Agency (FHFA) published the 2020 conforming loan limits for Freddie Mac and Fannie Mae. Click here for more.
Oral Arguments Held in AHP Case
The U.S. Court of Appeals for the District of Columbia Circuit recently heard oral arguments in the case brought by a dozen attorneys general (AGs) challenging the Department of Labor (DOL) association health plan (AHP) rule issued in 2018. Click here for more.
Board of Directors Special Report from NAR Annual: MLS ‘Clear Cooperation Policy’, Code of Ethics Tranining Requirment Recommendations Pass
NAR’s Board of Directors approved MLS Statement 8.0, also known as the Clear Cooperation policy, at its meeting during the 2019 REALTORS® Conference & Expo. The policy requires listing brokers who are participants in a multiple listing service to submit their listing to the MLS within one business day of marketing the property to the public. The policy summary and Q&A is available here. The Board of Directors also approved a change to NAR's Code of Ethics training requirement. The change extends the training requirement from every two years to every three years and extends the current Cycle 6 deadline from Dec. 31, 2020, to Dec. 31, 2021. The next cycle (Cycle 7) will begin Jan. 1, 2022, and end Dec. 31, 2024. View additional board actions by clicking here.