The House of Representatives passed a spending package that will fund the federal government throughout the fiscal year of 2020. In a recently released report regarding this legislation and its predicted effects, the National Association of Realtors President Vince Malta gave his opinion on the matter, stating that “Confidence and stability are two of the most critical factors impacting America’s housing market and economy. Fortunately, this funding agreement delivers that certainty to NAR’s 1.4 million members and the clients they work hard to serve every day.”
Malta then referred to his organization’s previous endeavors, stating that “The National Association of Realtors fought to eliminate short-term questions surrounding the status of the National Flood Insurance Program, federal terrorism insurance and various tax provisions, all of which will allow our members to plan better, minimize stress for prospective home buyers and sellers and keep our nation’s economy moving forward. While NAR applauds today’s votes, we urge Congress to use the time afforded by this agreement to work toward sustainable, bipartisan solutions to programs like the NFIP, which protect millions of Americans every year.”
The legislation allows the National Flood Insurance Program (NFIP) to continue throughout September 30, gives numerous tax provisions that will be a real boom to real estate markets, and reinstated the Terrorism Risk Insurance Program (TRIP) to be in operation for seven more years.
The reauthorization of the Terrorism Risk Program was an especially welcome win for NAR, as such insurance is often a non-negotiable requirement needed before countless commercial practitioners nationwide can secure their desired financing. Without such funding that allows this provision of TRIP, many fear a repeat of the debacle of 2001 occurring, a time of turmoil when the rates for terrorism risk insurance were either raised to skyrocketing prices or insurers simply stopped giving hopeful clients coverage whatsoever. In order to avoid this, the NAR took the initiative to be proactive, urging Congress to reauthorize the program before it expired to ensure its continuance through at least 2020.
Regarding the NFIP, its extension, which will last nine months, will make certain that policies can be properly executed throughout the year. As for the tax provisions, the trio that were particularly of interest to the real estate market were the exclusion of forgiven mortgage debt from gross income, the deductibility of premiums for mortgage insurance, and the deduction of the cost of improvements to commercial buildings that make them energy efficient—all of which had previously expired in 2017.