FEDERAL HOUSING FINANCE REFORM ACT OF 2005 -- (House of Representatives - October 26, 2005)
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Mr. PASCRELL. Mr. Chairman, I first of all commend the chairman and the ranking member for putting a great bipartisan bill together concerning government-sponsored enterprises.
In addition to establishing a very strong, independent regulator, the legislation will also create a sorely needed affordable housing fund.
The housing fund will help people with low incomes who face the greatest difficulty in finding housing that is available and affordable; but as we put forward this new housing fund, I do not think the manager's amendment is a very good one. We should never force nonprofits to choose between providing affordable housing and encouraging full participation in the American Dream.
The housing trust fund will provide a much-needed stimulus to our American economy, but it is not only low-income Americans who suffer from lack of affordable housing. I would ask the gentleman to please be cognizant of what I am saying. I know my district and the area within my district. A recent study has found that 4.8 million working families, many of them middle-income, have faced critical housing needs in recent years, spending more than half of their income on rent or living in substandard housing.
To help struggling middle-class families, it is essential that we preserve section 123 of this bill, which raises the conforming loan limit by up to 50 percent for certain high-cost housing areas. Without raising that limit, the benefits of the GSE housing subsidies are not distributed evenly or fairly across geographical lines.
In 2003, Fannie Mae and Freddie Mac purchased 35 percent of all mortgages originated nationwide. In several high-cost housing areas, these institutions were able to purchase fewer than 30 percent of the new mortgages. In my area, a large portion of real estate transactions take place over the conforming loan limit.
In my own district, my own area, Bergen, Passaic, and Essex counties, the median price of housing is 125 percent above the existing loan limit, one of the highest rates in the country.
This is an unfair limit. It prevents many middle-class families in New Jersey from being able to own a home in the State.
At a time, Mr. Chairman, when wages are stagnant, energy prices soaring, college tuition skyrocketing, we are well aware of just how much these hardworking families are being squeezed financially. This is common sense. This is not Democrat or Republican. This is common sense that we help middle-class folks out to purchase the homes. And I am not going to talk personally to the gentleman from New Jersey, but on this he is dead wrong.
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