“This could be the best possible time to buy”
Our interview with Secretary of Housing and Urban Development Shaun Donovan.
Secretary of HUD Mr. Shaun Donovan thank you for joining us on Real Estate Today.
It's great to be with you.
You made a big announcement at the Real Estate Summit, saying that you would like to see the $8,000 tax credit available at the settlement table for all FHA and some other loans. Why is that?
Well the tax credit is an important part of our overall efforts, the President's efforts to get this housing market back on track, to get the broader economy back on track and we want to make sure that…that we do as much as possible to ensure that that tax credit can be effective.
One of the reasons of course that it is right now available after the fact is that many members of Congress were afraid we could get into the same mess all over again. People who couldn't really afford a house, getting $8000, getting into one, and then losing the home. Any thoughts on that?
Well, this has to be implemented in a way that's the right way. That's why our focus is going to be on FHA-approved lenders and only focusing on folks that we believe are going to do the right thing by consumers and home buyers and wouldn't take advantage of this.
For a moment, not talking to me, but talking to the people who are listening to this show, people who might want to buy a house. What do you tell them about this new plan and what could it mean to their chances of being homeowners?
Well what I would say is while there has obviously been a lot of uncertainty in the housing market over the past year or more we're at a pretty important time with interest rates at historic lows, with housing more affordable than it's been perhaps in a generation, that in many communities that this could be the best possible time to buy. So if it's right for your family, if it's right for you, I would think seriously about this being the perfect time to buy a home. The other thing I would say is make sure you get the right product, make sure it's affordable to you and your family. FHA can be part of the solution.
Looking at the big picture now, how much of a role does housing play in our eventual recovery?
Look the housing crisis… The economic crisis started with the housing crisis. And I believe as the President does, that we're not going to get out of this economic crisis without the housing market getting fixed. And that's why he took, within one month of taking office, aggressive action with the Making Home Affordable plan right alongside all of the other efforts, through the
Through the Recovery Bill, through our Financial Stability Plan, to get all parts of this economy moving again. Housing is a critical part, one of really three legs of the stool of economic recovery.
Ever since you launched your website, which is tremendously successful, you said 16 million hits…
…16 million hits just in the last few weeks…
That's amazing. Helping people hold onto their homes, helping people modify their mortgages, helping people avoid foreclosure in so many ways. A lot of people know about that, but what we are hearing in the field is that not as many people know about the $8,000 Tax Credit and are confused about some of the elements. We heard earlier today that some people asked, "Can I get the $8,000 and my wife get an $8,000?" Do you intend to publicize your new changes to monetize the $8,000 in the same way you publicized Making Home Affordable?
I think it's important that we get word out about the tax credit more broadly not just within FHA. And we are working with Treasury and across the administration to make sure that information does get out and that it's used effectively and responsibly as well.
Finally, when do you think you'll finally be able to say, "Starting today, you can get the $8,000 on an FHA loan at the settlement table."
Well we're working out the final details and I hope that we will be able to do that in the coming days.
Secretary of Housing and Urban Development Shaun Donovan thank you for joining us on Real Estate Today.
I am frequently asked if the $8000 tax credit applies for condo and co-op purchases. The answer? Yes...
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