Morgan Stanley Bullish on Housing, Lawmakers Want to Revive Build America
A major financial brokerage reiterated its prediction of a US housing recovery, and lawmakers introduced bills to permanently revive the Build America bond program.
Residential Construction Up
In a note last month, Morgan Stanley economists wrote: “Despite a weak first quarter on several fronts of the US economy, the housing sector has been a source of relative strength. In our view, the US housing sector is poised to accelerate into the spring, a traditionally strong period for housing.”
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And in a note last Wednesday, the same team wrote, “May was arguably the most positive month for housing data in quite some time, and Monday’s construction spending print was the cherry on top.”
Morgan Stanley was responding to several housing data reports that dropped last month that mostly beat economists’ expectations and confirmed their outlook for 2015.
Build America Bills Introduced
Rep. Richard Neal and Sen. Edward Markey, both Massachusetts democrats, introduced identical bills last week that would permanently revive the Build America Bond program with lower subsidy rates and prevent issuers from being hurt by sequestration.
Build America Bonds are taxable municipal bonds that carry special tax credits and federal subsidies for either the bond issuer or the bondholder. They were created as part of President Barack Obama 2009 stimulus package law, but the program expired December 31, 2010.
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