Atlanta’s Realtors protect, preserve property rights, ownership

Todd Emerson is president-elect of the Atlanta Board of Realtors, and senior vice president and managing broker of Harry Norman, Realtors Atlanta Perimeter and Blue Ridge offices.

At the Atlanta Board of Realtors (ABR), our mission is to protect, preserve and defend real property ownership, private property rights, and a favorable business environment for our members. Realtors work constantly on behalf of homeowners, not only as it pertains to the sale or purchase of a home, but to protect all those associated rights.

This core value to protect homeowners is just one reason why each year a contingent from ABR heads to Washington, D.C., to meet with elected representatives. The agenda: discuss pressing issues relevant to metro Atlanta residents and Realtors. During our visit recently, we focused on several pressing issues: homeownership tax deductions, the Federal Housing Administration (FHA), and restructuring Freddie Mae and Freddie Mac.

Both the House and Senate have once again been considering different plans to reform the federal tax code. As a result, “everything is on the table,” including various real estate tax benefits. It may surprise you to learn that the mortgage interest rate deduction is one of those items. While it was essentially “saved” last December, there is talk in the halls of Washington of eliminating it once again. While advocates say they only want to ensure that high earners are not able to itemize it, or to deduct as much as they currently can, this is a slippery slope.

The same issue holds true for the ability to itemize your local property taxes which is also being considered for elimination. Not as widespread, but with an equally destructive impact on housing prices is the loss of the second home mortgage deduction. Here are some statistics that the National Association of Realtors (NAR) released that demonstrate the impact eliminating these deductions may have:

• More than 75 percent of homeowners utilize the mortgage interest deduction over the period they own their home.

• For many homeowners, property taxes are their largest tax deduction, one that continues even after a mortgage is paid off.

• The value of both mortgage interest and property tax deductions is capitalized into house prices. Eliminating the mortgage interest deduction, for example, would cause on average a 15 percent decline in value of homes. Decreasing the deductions, even for a limited group, compresses the value of all homes.

• Further declines in home values will harm housing markets, and stymie our nascent housing recovery.

• Reducing the capital gains exclusion thresholds would harm household retirement savings and reduce financial flexibility.

In regard to the FHA, we want to ensure that the Federal Housing Administration (FHA) single-family program has the tools and policies in place to meet its mission of providing access to safe, affordable mortgage financing to qualified borrowers nationwide. FHA’s single-family mortgage insurance program helps preserve private financing options for homebuyers regardless of local, regional or national economic conditions.

We also advocated for the restructuring of Fannie Mae and Freddie Mac and encouraged the return of private capital. By doing so we can ensure that affordable mortgages are available to consumers in all types of markets, and avoid a major disruption to the nation’s economy that would result from the total collapse of the housing finance sector.

Those of us who attended the meetings felt very confident our message was heard loud and clear. NAR has a tagline on its website that says: “Homeownership is not a loophole.” I am proud to be part of an organization like ABR that works hard each day to ensure that is not just a saying.