Of those jobs, one million are in housing construction and related fields. According to the National Association of Home Builders (NAHB), housing accounts for 16 percent of the U.S. economy under normal conditions. It goes without saying that the success of the nation's housing industry is critical to our full economic recovery.
One especially successful provision of the Recovery Act has been the $8,000 first-time homebuyer tax credit, which has already helped prevent the number of home sales from slipping further, made homes more affordable for families and individuals, and created much-needed jobs. Right now, the credit is set to expire at the end of this year, on December 1.
That's why I recently introduced legislation, along with my colleague Congressman Frank Kratovil of Maryland, that will allow families and members of the housing industry to continue to benefit from this program.
The Tax Credit Extension for Homebuyers with a Loss Deduction Incentive Act (H.R. 3640) will extend for one year the homebuyer tax credit, expand the credit to all homebuyers purchasing a principal residence, and provide relief for individuals or families who are forced to sell their home at a loss.
Research conducted by the National Association of Realtors (NAR) suggests that as many as 355,000 home sales this year can be directly attributed to the availability of the initial credit. For every home sold, approximately $60,000 of additional economic activity is generated. In Mississippi, an estimated 17,300 first-time buyers will be able to take advantage of the credit before its current expiration date.
This tax credit is working.
As a veteran Realtor for over 30 years, I have seen firsthand the ups and downs associated with the housing market. Recent signs of recovery in the market are certainly encouraging, but we must follow through and sustain the progress linked to the initial benefits of the homebuyer tax credit.
As my friend Frank Kratovil said when we introduced this bill, in this economy it would be foolish to allow something that's working to simply expire.
NAHB research indicates that the measures included in H.R. 3640 would create nearly 350,000 jobs, increase home purchases by 383,000 and boost home starts by 82,000. The measures would also generate $16.1 billion in wages and salaries, along with $12.1 billion in business income. These estimates don't even take into account the larger impact that continued stabilization of the housing market will have on our economy as a whole.
By making the tax credit available for an additional year, H.R. 3640 will directly impact Realtors, home builders, mortgage lenders, construction companies, and other businesses. The legislation has already received support from NAHB, NAR, and the National Association of Mortgage Brokers (NAMB). In addition, the furniture industry, a pillar of North Mississippi's local economies, stands to gain significantly from a homebuyer tax credit extension and expansion. When people purchase new homes, they purchase new furniture. For this reason, H.R. 3640 would be of especial benefit to our region.
Improving the housing market is essential to getting our entire economy back on track. I am optimistic about the prospects of all or some of the provisions in H.R. 3640 becoming law, and will keep working hard to see that these measures are implemented.
Contact U.S. Rep. Travis Childers at 1708 Longworth HOB, Washington, DC 20515, or 337A East Main Street, Tupelo, MS 38804.