Senator Santorum Introduces Legislation Encouraging Homeownership

Senator Santorum Introduces Legislation Encouraging Homeownership

U.S. Senator Rick Santorum (R-PA), Chairman of the Senate Republican Conference, today introduced the Community Development Homeownership Tax Credit Act of 2005, which encourages the construction and rehabilitation of homes for low-income families in economically distressed areas.

"As I travel throughout Pennsylvania, I consistently hear from people that they would like to start a family and own a home. This legislation will help make that dream a reality for many Pennsylvanians," said Senator Santorum. "Owning a home encourages personal responsibility, provides economic security, and gives families a greater stake in the development of their communities."

The production or refurbishment of new homes will create construction and construction-related jobs, increasing economic growth while lowering the unemployment rate and stabilizing and building up communities. This proposal will allow states to allocate tax credits to developers and investors to construct or substantially rehabilitate homes in economically disadvantaged communities for sale to low- or moderate-income buyers.

The credit would generate equity investment sufficient to cover the gap between the cost of developing affordable housing and the price at which these homes can be sold in many low-income neighborhoods to eligible buyers. It provides investors with a tax credit of up to fifty percent of the cost of home construction or rehabilitation.

Statistically, the homeownership rate among low-income families is lower than the overall national average. According to the Census Bureau, in 2004, the homeownership rate for non-Hispanic whites reached 76 percent, compared to 49.1 percent for African-Americans and 48.1 percent for Hispanics or Latinos.

"I want to thank Senator Santorum for his leadership on this important piece of legislation. The Community Development Homeownership Tax Credit Act will help expand the supply of affordable homes throughout Pennsylvania. In essence, this legislation will help bridge the gap between the cost of developing affordable housing and the price that buyers can afford to pay for a home," said James L. Conner, 2005 President of the Pennsylvania Builders Association.

Senate cosponsors of the Community Development Homeownership Tax Credit Act of 2005 include Senators Gordon Smith (R-OR), John Kerry (D-MA), Wayne Allard (R-CO), Debbie Stabenow (D-MI), and Paul Sarbanes (D-MD). In addition, the legislation has been endorsed by a broad coalition of housing-related organizations including the National Association of Home Builders, the National Council of State Housing Agencies, and the National Association of Realtors. Significant non-profit groups including Habitat for Humanity, as well as the Local Initiatives Support Corporation, and The Enterprise Foundation, have also expressed support for the legislation.

"This homeownership tax credit will help an estimated fifty thousand low- and moderate-income families in our nation's urban and rural communities achieve the American dream of homeownership every year," said U.S. Representative Thomas M. Reynolds, (R- NY-26). "In addition to spurring home ownership, this legislation will generate an estimated $2 billion of private equity investment and $6 billion of development activity- meaning hundreds of thousands of new jobs in our communities."

http://santorum.senate.gov/public/index.cfm?FuseAction=PressOffice.View&ContentRecord_id=1200&Region_id=0&Issue_id=0&CFID=6802519&CFTOKEN=63480384