Capital gains exclusion bill draws more backers in Senate, House
The More Homes on the Market Act now has 174 co-sponsors in D.C. Plus, consumer advocacy groups raise objections about proposed mortgage lending rule changes.
Key points:
- The bipartisan capital gains bill added three more supporters in the House and one more supporter in the Senate last week.
- NAR, which also backs the bill, says it would help unlock inventory in addition to allowing homeowners to retain more equity when they move.
- Also in D.C., several consumer advocacy groups are urging the CFPB to retain existing mortgage lending protections.
Consumer advocacy groups took to the nation's capital this week to recommend that existing protections for mortgage borrowers remain in place amid proposed rule changes.
Also in Washington, D.C., a key capital gains tax exclusion bill has gained four additional sponsors, signaling growing enthusiasm for the popular bipartisan legislation.
More legislators throw support behind capital gains proposal
Legislation aimed at helping homeowners retain more equity when they sell their home is amassing support from legislators on both sides of the aisle.
The More Homes on the Market Act, introduced as H.R.1340 in the House, proposes changes to the tax code to increase the capital gains tax exclusion for the sale of a home to up to $500,000 for individuals and up to $1 million for married joint filers. The increase would double the current capital gains tax exclusion amounts, which have been unchanged since 1997.
If the bill passes, the new amounts would also be adjusted annually for inflation.
The bipartisan bill currently has support from 151 representatives, while its companion bill in the Senate (S.3332) has support from 23 senators. Dozens of new co-sponsors have signed on since the beginning of June, including four so far this month, Realtor.com reported.
The legislation has been framed as a way to boost housing supply by lowering a common barrier keeping would-be sellers in their homes longer, and it has received support from the National Association of Realtors. During NAR's midyear legislative meetings in June, NAR Director of Federal Tax Policy Evan Liddiard said it's "about people who want to move."
"We have families that need to size up their homes but don't have access because this tax is locking up inventory," Liddiard said.
Consumer advocacy groups sound alarm about 'roadmap for abuse'
A handful of consumer advocacy organizations have issued a warning about proposed changes to the Consumer Financial Protection Bureau's (CFPB) mortgage lending rules.
The current rules help borrowers understand and navigate the lending process, the groups said in a news release, and rolling them back "would open the door for disreputable lenders to prey on consumers and saddle them with risky loans."
This week, the groups — the Consumer Federation of America, the National Consumer Law Center, the National Housing Law Project, the National Fair Housing Alliance and the Americans for Financial Reform Education Fund — submitted a 26-page document containing comments on the proposed changes.
They are urging the CFPB to keep the existing rules "instead of weakening regulations."