Majority of the House Reaffirms Banks Do
Not Belong in Real Estate
For the second consecutive Congress, a majority of the U.S. House of
Representatives has cosponsored legislation that will keep banking
conglomerates out of real estate brokerage and property management and
permanently stop a proposed rule pending before the U.S. Treasury Department
and the Federal Reserve Board, the National Association of REALTORS
announced today.
A total of 229 members of the House and 17 U.S. Senators have signed onto
the Community Choice in Real Estate Act (H.R. 111/S. 98) since the
legislation was reintroduced on January 7, the first day of the 108th
Congress, by Reps. Ken Calvert (R-Calif.) and Paul E. Kanjorski (D-Penn.)
and Sens. Richard Shelby (R-Ala.), Wayne Allard (R-Colo.) and Hillary Rodham
Clinton (D-N.Y.). These latest cosponsorship numbers reflect recent Capitol
Hill visits by REALTORS who were in town for NAR's Midyear Legislative
Meetings last week.
Banking conglomerates are seeking permission to sell and manage real estate
via a proposed rule before the Federal Reserve and Treasury. However, the
proposed rule is contrary to what Congress intended when it passed the 1999
Gramm-Leach-Bliley Act. At the behest of Rep. Anne Northup (R-Ky.), a budget
provision barring Treasury from finalizing the rule was included in the
fiscal year 2003 spending package passed by Congress and signed by President
Bush earlier this year. The Community Choice in Real Estate Act would amend
the Bank Holding Company Act and permanently prohibit big banks from
entering the real estate business.
"For the second Congress in a row, a majority of the House of
Representatives has affirmed that banking conglomerates should not be
allowed to add real estate brokerage to their ever-expanding list of
business ventures," said NAR President Cathy Whatley, owner of Buck & Buck
Inc. in Jacksonville, Fla. "The new cosponsorship numbers, coupled with
passage of the Northup amendment earlier this year, show that Congress never
intended to allow banks to get into real estate."
"We had over 245 members of the House and 15 Senators on board the Community
Choice in Real Estate Act last year and we're on track to surpass those
milestones this year," said Martin Edwards Jr., NAR immediate past
president. "On behalf of almost 900,000 REALTORS and countless communities
all across the country, we call on Congress to accede to the will of the
majority and pass the bill. We will not relent until the Community Choice in
Real Estate Act becomes the law of the land."
"We also expect the Treasury Department to abide by congressional intent –
the cosponsorship numbers don't lie – and deny the proposed rule. We
continue to believe that banks cannot obtain through regulation that which
they obviously cannot get through legislation," Edwards said.
A number of consumer, community and small business advocates have voiced
their support because they agree that if big banks were allowed to take over
local real estate businesses, there would be a negative impact on
communities across America, leaving home buyers and sellers with fewer
choices, higher loan fees and reduced customer service.
Organizations that have voiced support for the Community Choice in Real
Estate Act include the Building Owners and Managers Association, CCIM
Institute, Consumers Union, Institute of Real Estate Management,
International Council of Shopping Centers, National Affordable Housing
Management Association, National Association of Home Builders, National
Association of Industrial and Office Properties, National Auctioneers
Association, National Fair Housing Alliance, National Federation of
Independent Business, National Leased Housing Association and the National
Community Reinvestment Coalition.
"Housing continues to be the leading sector of our economy. Approximately 68
percent of new growth in our gross domestic product (GDP) last year was
housing-related. We're thrilled that a majority of the House and close to 20
Senators agree that America simply cannot afford to allow big banks to take
over the real estate business, which continues to be the leading pillar of
our economy," Whatley said.
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