New York congressman introducing new housing stimulus

U.S. Rep. Gary Ackerman, D-N.Y., is planning to introduce "Homestead: Act 2," a bill designed to encourage homeownership by offering potential homeowners incentives to invest in existing homes.

The bill offers two sets of incentives:

• The first 2 million creditworthy borrowers would be able to receive up to a $20,000 matching subsidy toward downpayment on a single-family home. The subsidy would be in the form of a loan, but one-fifth of the loan would be forgiven every year for the first five years of ownership.
• The first 1 million investors that purchase existing single-family homes as rental properties would get a 10-year tax exemption on the rental income

The cost of the act, Ackerman said, would be alleviated by lowering the tax rate on repatriated corporate income from 35 percent to 10 percent. That would encourage more companies to return their capital to the United States, he said.

“Clearly, ‘Homestead: Act 2’ would help to eliminate quickly the overhang glut of the housing market, putting two million owners in homes and inspire the purchase of an additional one million homes by investors who will rent them out, and enjoy tax-free rental income for 10 years,” said Ackerman. “This would clear the way for new housing starts, and put millions of Americans back to work. It would incentivize corporations to bring their cash cheaply back into the United States. In addition, the newly emancipated billions would further spur the economy.”