NAR-Backed Condo Legislation Passes U.S. Senate, Offers Relief for Homebuyers

The U.S. Senate has passed H.R. 3700, the “Housing Opportunity Through Modernization Act,” by unanimous consent. This legislation includes reforms to current Federal Housing Administration restrictions on condominium financing, among other provisions, and is long supported by the National Association of Realtors®.

Changes include efforts to make FHA’s recertification process “substantially less burdensome,” while lowering FHA’s current owner-occupancy requirement from 50 percent to 35 percent. The bill also requires FHA to replace existing policy on transfer fees with the less-restrictive model already in place at the Federal Housing Finance Agency.

NAR testified last year in support of the bill, which passed in the House of Representatives 427-0 in February.

Tom Salomone, president of NAR and broker-owner of Real Estate II Inc. in Coral Springs, Florida, praised the legislation as a significant step towards eliminating barriers to safe, affordable mortgage credit for condos.

Following is a statement from Mr. Salomone:

“Condominiums often represent an affordable option that’s just right for first-time and low-to-moderate income homebuyers. Unfortunately, overly-burdensome restrictions on condo financing have for too long put that option out of reach for many creditworthy borrowers.

“This legislation meets those restrictions head on, putting the dream of home ownership back in reach for more Americans.

“Tight inventory and rising home prices are a reality of today’s market, and mortgage credit is hard to come by. We should take every opportunity to clear the path for well-qualified borrowers to purchase a home when they’re ready, and this legislation does just that.

“Sens. Tim Scott (R-S.C.) and Robert Menendez (D-N.J.) have done tremendous work to see H.R. 3700 move forward, and we’re thankful for their support. Realtors® made their voices heard as well, reaching out to their Senators and Representatives to remind them of how important this issue is to home ownership.”

“We look forward to seeing this legislation signed into law so homebuyers can start seeing some much-needed relief.”