Lawmakers asked to involve business in housing policies
Outside a well-known restaurant a few blocks from the White House, a homeless man sits with his head down, staring into an empty hat on the sidewalk before him. Inside, over a warm breakfast of eggs and toast, housing advocates are talking about the need for a national housing program. Nudged into the limelight by the growing population of street people, requests for a federal housing policy are finally mustering congressional attention.Skip to next paragraph
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Homelessness might not be a ``housing'' problem, but it has ``raised public awareness that housing itself is an issue,'' says Diane Disney, a professor of business at Brandeis University, where she has done extensive research on housing issues.
Soaring real estate costs - particularly in the Northeast and on the West Coast - have shrunk the number of homeowners in the United States and put more pressure on the rental market. This has, in turn, contributed to rising rents and taken more units away from low-income tenants.
This week the Senate Banking, Housing, and Urban Affairs Subcommittee is holding hearings to gather ideas on what a national housing policy should include. The final program, sponsored by Sens. Alan Cranston (D) of California and Alfonse D'Amato (R) of New York will be introduced in July, a subcommittee aide says.
In a recommendation to the subcommittee Tuesday, James Rouse, co-chairman of the National Housing Task Force, estimated that a minimum housing program would cost the government about $3billion a year.
But other groups, pointing to problems in all areas of the housing market, are calling for more than a minimum policy, one that involves local and federal governments as well as private-sector support.
Some people would, in fact, like to see more initiatives by the private sector and less government involvement. David Schwartz, chairman of the National Housing Institute, a nonprofit research group, advocates extensive employer involvement in housing assistance, through tax-advantaged personnel benefits, and employee home-ownership plans similar to stock ownership plans.
In a proposal the institute submitted to Congress, Mr. Schwartz, who is also a New Jersey state assemblyman, recommends such assistance as:
Interest-rate buy-downs, or mortgage interest rate subsidies, which several businesses, including the Colgate-Palmolive Company, offer their workers as part of the employee benefits package.
A national lease-purchase home-ownership program, whereby builders would receive low-interest loans from the government, and they in turn would give families two or three years to pay off the down payments (such a program exists in New Jersey).
Individual housing accounts, similar to individual retirement accounts, which would allow tax-deferred saving for buying a home.
Other proposals include employee home-ownership plans similar to stock ownership arrangements, and a national housing investment corporation. This, Schwartz says, would make the government a partner in a diversified portfolio of housing assets.
James Christian, chief economist at the United States League of Savings Institutions, would like to see the government encourage saving by lifting its restrictions - imposed by the 1986 Tax Reform Act - on the use of 401(k) plans toward down payments. He believes that ``people already go into debt too easily.''
The issue is not merely one of low- or no-income housing, Schwartz says. The problem affects middle-income America as well, and more severely on the East and West Coasts, he says.