There's something for housing too, including a tax credit of $8,000 to first-time low- and middle-income homebuyers. A total of $6.6 billion has been designated for this purpose. In addition, $2 billion will be targeted on a neighborhood stabilization program that will help areas with many foreclosures.
A week later, President Obama announced a $75 billion lending plan to help homeowners avoid foreclosure by lowering monthly payments for certain borrowers. There's also large-scale assistance for mortgage giants Freddie Mac and Fannie Mae.
There's plenty of evidence that some kind of intervention is necessary. The Kitchen Cabinet Manufacturers Assn. monthly Trend of Business survey reported that cabinet sales for participating companies were down 19.3 percent in 2008 compared to 2007.
Stock sales were down 18.5 percent, semi-custom down 19.9 percent and custom down 20.6 percent.
For the month of December, sales were down 26.7 percent compared to December 2007.
KCMA is also part of a group that is trying to do something about those numbers in the future. The Fix Housing First Coalition, www.fixhousingfirst.com, was formed to push for a housing recovery plan that could stop the decline in house values, stabilize financial markets and spur consumer demand.
There are more than 600 organizations in Fix Housing First , including home building companies and manufacturers. The coalition supports enhancements to the home buyer tax credit and seeks to provide below-market fixed-rate mortgages. A similar plan, offering a tax credit for new homes, was reportedly successful in 1975 during a serious recession.
Dick Titus, KCMA executive vice president, said that until the housing issues addressed by this proposal are resolved, the U.S. economy will continue its downward spiral. He believes that adoption of these proposals will have a huge positive impact on the overall economy.
Residential furniture sales have been in a longer slump. The American Home Furnishings Alliance has joined forces with the International Sleep Products Assn. and National Home Furnishings Assn. to propose consumer and commercial tax incentives.
The coalition has proposed a temporary (two or three years) refundable consumer tax credit for the purchase or installation of home furniture.
The proposal would directly protect American manufacturing and retail jobs, says AHFA CEO Andy Counts. The goal, according to ISPA president and CEO Dick Doyle, is to create demand for the industry's products, and help to generate good-paying American jobs. For more information on this proposal, see www.ahfa.us.
As big as the current legislation is, there may be more stimulus plans later this year.
We hope that housing-related issues are front and center in any Fix Everything Forever proposals.
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