Bill Overview
Title: Affordable Housing Bond Enhancement Act
Description: This bill modifies the Mortgage Revenue Bond (MRB) and the Mortgage Credit Certificate (MCC) programs of state housing finance agencies to expand the supply of affordable homes and homeownership for low- and moderate-income homebuyers. The bill requires the Internal Revenue Service to annually report to the congressional banking and tax committees on the use by states of their private activity bond authority for housing investment. It also increases the MRB home improvement loan limit from $15,000 to $50,000. The bill permits states to redesignate their carryforward authority and use it for housing investment and permits MRBs to be used to refinance home loans for borrowers who have incomes below 115% of median family income. The bill modifies the recapture requirement for homeowners who receive a MRB-financed mortgage or an MCC and sell their residences within the first nine years of ownership and reduces the time in which a recapture tax may be assessed from nine to five years. The bill revises the MCC benefit calculation to a simple percentage of the original loan balance. It also extends the MCC revocation period from two to four years. The bill reduces the public notice requirement for MCC issuers from 90 days to 30 days and eliminates certain MCC reporting requirements.
Sponsors: Sen. Cortez Masto, Catherine [D-NV]
Target Audience
Population: Low- and moderate-income homebuyers
Estimated Size: 25000000
- The bill aims to improve affordable housing options and homeownership opportunities by expanding the Mortgage Revenue Bond (MRB) and Mortgage Credit Certificate (MCC) programs.
- Low- and moderate-income homebuyers would directly benefit as these programs are targeted at making housing more affordable to them.
- The bill's adjustments to loan limits and tax requirements could encourage more individuals in these income brackets to purchase homes.
- The act's provisions to allow states more flexibility in using their bond allocation for housing can lead to increased housing investments and availability.
Reasoning
- The policy targets low- and moderate-income homebuyers, a significant group within the US population.
- Budget constraints limit how many people can be directly impacted, so a diverse selection of individuals affected differently by the policy is considered.
- To analyze the impact, only a portion of this group realistically feels substantial change, due to factors like regional housing market variations and current mortgage situations.
- The Cantril scale helps evaluate improvements in wellbeing, assuming successful policy implementation makes homeownership more attainable or reduces financial stress.
Simulated Interviews
elementary school teacher (Raleigh, NC)
Age: 34 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 15/20
Statement of Opinion:
- I think this policy might finally allow me to consider buying a small home for my family.
- I currently can't save enough for a down payment, but if mortgage terms improve, it could be possible.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 5 |
construction worker (Chicago, IL)
Age: 38 | Gender: male
Wellbeing Before Policy: 4
Duration of Impact: 6.0 years
Commonness: 12/20
Statement of Opinion:
- I'm a bit skeptical because housing has always seemed out of reach in this city.
- If this policy helps me get a stable place for my family, it would be life-changing.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 6 | 4 |
| Year 5 | 8 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 5 |
freelance graphic designer (Los Angeles, CA)
Age: 27 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 10/20
Statement of Opinion:
- Affordable housing sounds great, but I'm not sure if this policy will help with the expensive market in LA.
- I'm hopeful but cautious; I need concrete changes to really see a future here.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
nurse (Boise, ID)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 4.0 years
Commonness: 8/20
Statement of Opinion:
- I've been eyeing a fixer-upper, so increasing the improvement loan limit could be perfect for me.
- This policy might ease my financial stress from managing renovation costs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
software engineer (Houston, TX)
Age: 31 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 9/20
Statement of Opinion:
- Refinancing my mortgage through this policy could significantly reduce my financial burden.
- Any relief in my monthly payments would be a big help.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
retired (Milwaukee, WI)
Age: 59 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 2.0 years
Commonness: 5/20
Statement of Opinion:
- I doubt this policy will help me own a home at this age, but if it frees up rental options, it might.
- Any improvement on rental availability or price reduction benefits me indirectly.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 4 |
| Year 2 | 4 | 4 |
| Year 3 | 5 | 4 |
| Year 5 | 5 | 4 |
| Year 10 | 5 | 4 |
| Year 20 | 5 | 4 |
barista (Miami, FL)
Age: 29 | Gender: female
Wellbeing Before Policy: 3
Duration of Impact: 7.0 years
Commonness: 13/20
Statement of Opinion:
- The high cost of living is suffocating me, and I'm hoping this act provides some rescue.
- If mortgage payments replace my hefty rent, that is a game changer.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 3 |
| Year 2 | 5 | 3 |
| Year 3 | 6 | 3 |
| Year 5 | 7 | 3 |
| Year 10 | 6 | 3 |
| Year 20 | 6 | 3 |
semi-retired (Phoenix, AZ)
Age: 66 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 14/20
Statement of Opinion:
- I’d appreciate any tax relief or refinancing to manage my retirement finances better.
- I'm not sure if the policy caters to people already owning homes, but keeping more of my money would be nice.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
unemployed (Detroit, MI)
Age: 23 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 11/20
Statement of Opinion:
- I'm not aiming to buy a house immediately, but more affordable housing can help relieve pressure on my family.
- I believe opportunities might improve if housing policies make owning or renting easier.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
small business owner (New Orleans, LA)
Age: 52 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 4.0 years
Commonness: 7/20
Statement of Opinion:
- If the policy lowers the upfront costs for home buying, that could really help balance my financial commitments.
- I'm optimistic but uncertain how quickly benefits will reach people like me.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Cost Estimates
Year 1: $2000000000 (Low: $1800000000, High: $2200000000)
Year 2: $2000000000 (Low: $1800000000, High: $2200000000)
Year 3: $2000000000 (Low: $1800000000, High: $2200000000)
Year 5: $2100000000 (Low: $1900000000, High: $2300000000)
Year 10: $2300000000 (Low: $2100000000, High: $2500000000)
Year 100: $3000000000 (Low: $2800000000, High: $3200000000)
Key Considerations
- The bill will primarily benefit low- and moderate-income homebuyers by making homeownership more accessible.
- The costs associated with bond issuance and increased administrative overhead need careful management.
- Potential impact on housing markets must be monitored, ensuring the supply can meet the strategic government objectives.