Now that the dust has settled from the elections, Congress will be turning its attention to the debate over housing policy.

Thanks to national policy that has acknowledged the importance of the home in American family life for almost a century, generations of Americans have counted on their homes for their children’s education, their own retirement and a personal sense of accomplishment.


Policymakers are proposing radical changes that threaten the dream of homeownership for millions of current and future Americans. The policies could negatively impact Americans’ ability to buy a first home, keep their current home or enter into the move-up market.

Mortgage interest deduction

Eliminating or limiting the mortgage interest deduction would impose a huge tax increase on millions of middle-class homeowners and discourage prospective buyers. Changing the deduction would cause after-tax housing costs to increase and housing demand to decrease. Reduced demand would depress home prices, producing a sizable loss for existing homeowners. Such a change in home values could weaken economic recovery.


Mandating 20 percent downpayments

The national Qualified Residential Mortgage standard being proposed would require a minimum 20 percent downpayment and other stricter qualifications, which would keep homeownership out of reach for most first-time homebuyers and middleclass households. According to some research, it could take 12 years for typical families to save enough money for a 20 percent downpayment on a median-priced home.

Creditworthy borrowers denied opportunities


Even though there is pent up demand for homes in many parts of the country, the construction or sale of which would create jobs and support local economies, lenders are not making loans to qualified homebuyers. This is because of overly restrictive lending standards, which slow the housing recovery and hurt the economic recovery.

Restoring the flow of credit to qualified homebuyers will boost the housing market, help put America back to work, and strengthen the economic health of communities across the country. For more information on the impact of housing and homeownership, go to or email or

Karen Nakamura is CEO of the Building Industry Association of Hawaii.