Raise the debt ceiling: NAR president

Oct.October 11, 2013 03:00 PM

From the New York site: The National Association of Realtors said yesterday that Congress should raise the federal debt ceiling in order to avoid a default that would be “catastrophic” for the national housing market’s recovery.

In testimony before the Senate Committee on Banking, Housing and Urban Affairs, NAR president Gary Thomas said that unless the debt ceiling is raised in “a timely manner,” the country would face a recession that would wipe out the recent progress made in home prices, home sales and new residential construction.

“The momentum of the housing recovery will be in serious jeopardy if Congress is unable to move past unnecessary political brinkmanship over raising the debt limit,” Thomas said. “A default, or even the perceived threat of a default, could result in a harsh and long-lasting recession, which may be even more severe than the previous economic downturn.”

Even a one percent increase in mortgage rates could lead to up to 450,000 fewer home sales, Thomas said. The increase would push out many potential homebuyers by increasing their monthly mortgage payments and debt-to-income ratios, he added.

The uncertainty of the debt ceiling combined with the shutdown of the federal government has left New York City in somewhat of a deal-making limbo, as The Real Deal reported. [Inman News]Hiten Samtani

Related Articles

Jay Parker, Mike Pappas and Beth Butler

SoFla brokerage execs optimistic, say deals are still closing

(Credit: iStock)

South Florida residential construction starts jump 72% in January

Daily Digest Miami

Heir to Merck pharma fortune sells Palm Beach estate, Brookdale buys back Sawgrass Park portfolio for $80M: Daily digest

Daily Digest Miami

Ben Carson talks Opportunity Zones, top developers riff on condos vs. rentals: Daily digest

From left: Amir Korangy and Secretary of Housing and Urban Development Dr. Ben Carson

Ben Carson on Opportunity Zones, unity and red and black ants: TRD Miami Showcase & Forum

Arden home community and Stuart Miller

Lennar picks up 50 lots in western Palm Beach County

Construction of a new home (Credit: iStock)

Construction starts in South Florida fall almost 40% in June

New homes in Florida (Credit: iStock)

Tariffs, natural disasters are driving up construction costs in Florida: report