Yesterday, more than 500 REALTORS® from around the state – including almost 50 CCIAOR members – descended on Beacon Hill to advocate for homeowner, property rights and business issues.
CCIAOR members met with the local Cape Cod, Martha’s Vineyard and Nantucket delegations to discuss the REALTOR® Public Policy agenda for the year. In light of the ongoing conversations, much of the discussion focused on the regulation and taxation of short-term rentals.
Throughout the day, State Sen. Julian Cyr and representatives, Sarah Peake, Tim Whelan, Will Crocker and Dylan Fernandes all took time to hear the concerns of REALTORS®. Rep. David Viera also had staff in attendance.
The REALTOR® agenda for the day to support several tax provisions and land use reforms designed to help homeowners and increase housing supply in Massachusetts and oppose new taxes on home buyers, new taxes homeowners must collect from vacation renters and energy scoring that would stigmatize properties.
The delegation was receptive to the issues being discussed and listened. There was a lot of thoughtful communication back and forth.
Here is an overview of the issues:
First Time Homebuyer Savings Accounts
sponsored by State Sen. Julian Cyr from the Cape & Islands
WHY MAR SUPPORTS S. 1507: Saving for a down payment and closing costs for a home is difficult. Programs like Homebuyer Savings Accounts provide a state tax-assisted avenue for individuals, couples, or family members to contribute to the purchase of a home. This program would allow future homebuyers to deposit up to $5,000 per year into a First Time Homebuyer Savings Account and then claim that contribution as a deduction on their income tax. Additionally, any gains on the savings would be exempt from taxes. Each time a home is purchased there are many economic benefits to the community, including an average of $75,000 of expenditures related to that home purchase. Furthermore, owning a home also provides stability for families and the communities in which they reside as there are many documented social benefits of homeownership.
Mortgage Forgiveness Debt Relief
WHY MAR SUPPORTS H. 3337: This bill would allow homeowners to complete loan modifications, short sales and foreclosures without making them liable to pay state taxes on the forgiven debt. This bill would mirror the federal Mortgage Debt Relief Act of 2007, which was extended through 2016, to allow taxpayers to apply for this exclusion on their state tax return as well. If H.3337 is not enacted, many families across the Commonwealth will have to continue to pay income tax on “phantom income.” They will owe tax on money they’ve already lost and will be required to pay that tax at a time of dire hardship, when they are least likely to have the means.
The H.O.M.E Bill
WHY MAR SUPPORTS THE H.O.M.E BILL: Due to the short supply of housing in Massachusetts, potential homeowners continue to face increasing housing costs. One of the many issues driving the reduced housing stock is the presence of barriers to production resulting from current zoning laws. The Massachusetts Association of Realtors® in conjunction with the Greater Boston Real Estate Board has developed legislation addressing these barriers. Several of the provisions include easing the production of cluster development housing; allowing accessory dwelling units (ADU’s) by right; allowing multifamily housing construction by right; simplifying the dimensional variance burden and; approving special permits by a majority vote.
Room Occupancy Tax
WHY MAR OPPOSES ROOM OCCUPANCY TAXES: Occupancy tax proposals promote the creation of a new tax on homeowners who choose to rent their homes for a short term. In addition to established businesses like hotels, motels, and bed and breakfast establishments, these proposals would allow a city or town to charge a tax on any apartment, single or multiple family housing, cottage, condominium or timeshare unit. Private homeowners would then be responsible for the collection, handling, and remittance of these taxes to the Department of Revenue. The collection, handling, and remittance of these taxes is something that private individuals are not familiar with, as they have never been required to handle them and inadvertent errors in handling could result in sanctions. If passed, the homeowner would be required to comply with onerous business regulations that were never intended for the average homeowner
Mandatory Energy Scoring
WHY MAR OPPOSES MANDATORY ENERGY SCORING, S. 1839: Interferes with the market – Requiring an energy audit prior to listing will lead to delays in the homebuying process while affecting the negotiation of contracts regarding the acceptability of the audit. Impact on Middle Class – The bill does not help middle class homeowners achieve energy efficiency. Homeowners who cannot afford energy efficient upgrades would be unfairly impacted by this proposal. Current system works – Massachusetts residential consumers currently pay a surcharge on their energy bill for energy audits that they can have performed on their homes at no additional cost. According to publicly available information on www.masssavedata.com, in 2016, over 75,000 MassSave energy audits were conducted with a 39% closure rate for home insulation and a much higher closure rate when including other program benefits. Negative impact on older homes – Older homes are typically not as energy efficient as newer homes. Massachusetts has the second oldest housing stock in the nation, and many of those homes are located in less affluent communities where residents have few resources to upgrade their homes. The ratings resulting from mandatory energy evaluations could cause stigmatization of those older or historic houses.