We hold our monthly “Coffee with Your GADs” chat the first Tuesday of each month. This is your opportunity as a member to join our Government Affairs Directors for an informal discussion about policy and politics impacting the real estate industry and learn about CAR’s current advocacy initiatives. You can also share any news or trends that are of interest.
Here’s what’s on our mind this February:
FEDERAL
Flood insurance
The Flood Insurance Program has been extended to May 31. It is likely we will be lobbying for long term reform during NAR’s Midyear meetings in Washington, D.C., in May. If there is another call to action on the NFIP, please answer the call. It takes two minutes and does make a difference.Conforming loan limits
CAR and Illinois REALTORS® have sent a letter asking to increase conforming loan limits. Currently, Chicago has the same limits as cities in Indiana and Wisconsin. We’re looking to increase these limits in high-priced zip codes, in response to member feedback that there’s a stall here and higher conforming loan limits could help to create some churn. The recent government shutdown has delayed the response. Thank you to MRED for their assistance with the data used.Tax reform
Chicago should be prepared to see a substantial reduction in what they think their deductions will be this year. We’re closely monitoring the local impact – and our ears are open. Remember: CAR lobbied NAR to include State and Local Tax Deductions in their package and fight for its inclusion- we now have it, but not the full value. The problem will also increase the further you go from the city, as the ring and collar communities pay more than we do in the city. The impact will most definitely be felt there.Opportunity zones
NAR is starting to fall into line on Opportunity Zone discussion points – we are encouraging them to work immediately towards extending and furthering the zones, because right now, Chicago won’t get yield the same benefits other cities will simply because of our bureaucracy – by the time you get through the permitting, zoning, etc., necessary, the clock is ticking and you may not get your investment benefits. If you’re working on Opportunity Zone deals, please let us know – we want to understand more what the mechanics of those are looking like here in Chicago.STATE
Rent Control
Rent control continues to be a big issue. Illinois REALTORS® worked closely with CAR and our members to put together the framework for a study on what the impact of rent control would be on Chicago’s market. A few findings:- Rent control would prohibit 185,000 units from increasing rent, seizing up this supply
- Short term – owners will likely raise rents until new ordinance comes into effect
- Long term – owners will sell or look to conversion to condos
- Conversion is where most trend lines go
- Inventory could go up, but pricing will go down. The tax base will go down, and taxes will have to go up again.