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By Graham Wood<\/div><\/div>\n

NAR: The president-elect\u2019s proposals go further than current ones, notably over the racial wealth gap and a first-time buyer tax credit. But if he works with a divided Senate, it will force some compromises, making it hard to predict what will happen over the next four years.<\/span><\/span><\/p>\n<\/div>\n

WASHINGTON \u2013 While President-elect Joe Biden likely will make housing policy a higher priority than the Trump administration has, the effectiveness of Biden\u2019s agenda hinges on which party controls the U.S. Senate, Jim Parrott, a housing adviser to former President Barack Obama, said Thursday during the National Association of Realtors\u00ae\u2019 (NAR) virtual Real Estate Forecast Summit.<\/span><\/span><\/p>\n

\u201cThe Biden administration wants to deal with the racial wealth gap,\u201d Parrott said in a Q&A session with NAR President Charlie Oppler, \u201cand they view the racial homeownership gap as being a core part of that problem. If you can bridge the homeownership gap, you can bridge the wealth gap.\u201d<\/span><\/span><\/p>\n

Two of Biden\u2019s most anticipated proposals involve the reinstitution of a first-time homebuyer tax credit, which aims to help low-income households achieve homeownership, and the expansion of mortgage forbearance options. Whether these proposals stand a chance in Congress depends on the outcome of two Senate runoff races in Georgia, which will be decided Jan. 5 and determine Democratic or Republican control of the chamber.<\/span><\/span><\/p>\n

\u201cIf Georgia breaks [for Republicans], the Biden folks will have to rethink their strategy,\u201d Parrott said. \u201cThey remember how hard it was to get stuff done in the Obama years, and they\u2019ll go in eyes wide open. That means hiring the right people. The team Biden [is putting] together is a team that knows each other and has wrestled with similar issues in a time of economic stress. It\u2019s a pretty well-positioned team to move quickly and aggressively.\u201d<\/span><\/span><\/p>\n

One of the biggest issues facing the Biden administration will be the future of the government-sponsored enterprises Fannie Mae and Freddie Mac, Parrott said. President Donald Trump has taken steps to begin transitioning Fannie and Freddie to private ownership. If the mortgage giants, which have been under government conservatorship since the Great Recession, become privatized, Biden may have a harder time relying on them as avenues to administer federal housing programs that help boost homeownership.<\/span><\/span><\/p>\n

Parrott, who worked with Biden on housing issues in the Obama administration, recalled Biden as a \u201ccut-to-the-chase decision-maker\u201d who drilled down to specifics and \u201cwanted to understand whether the proposal on the table would hurt, say, firefighters who wanted to get a 30-year mortgage.<\/span><\/span><\/p>\n

\u201cBiden cares a lot about housing as part of the American dream,\u201d Parrott said. \u201cFor him, it\u2019s not an abstract concept; it\u2019s a centerpiece of how he thinks of himself as a leader.\u201d<\/span><\/span><\/p>\n

For that reason, one of Biden\u2019s first moves likely will be to expand mortgage forbearance options for homeowners struggling financially through the pandemic, Parrott predicted. He may extend forbearance timelines so they \u201cmatch up more with the timeline of the recovery. When people come out of forbearance, you want them to come into a healthy economy.\u201d<\/span><\/span><\/p>\n

However, he predicted that foreclosure levels resulting from the economic downturn likely won\u2019t be as severe as those of the Great Recession. Most homeowners aren\u2019t upside down on their properties and can \u201csolve their housing problems by selling rather than going into foreclosure,\u201d Parrott said.<\/span><\/span><\/p>\n

Source: National Association of Realtors\u00ae (NAR) <\/span><\/span><\/p>\n

\u00a9 2020 Florida Realtors\u00ae<\/span><\/span><\/p>\n<\/div><\/div>\n

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\nAuthor: kerrys<\/p>\n","protected":false},"excerpt":{"rendered":"