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HOMEOWNERS pay the property taxes that subsidize YOUR rental lifestyle, pay for parks and schools that YOU enjoy and send your kids too, and pay for the services that YOU enjoy in your neighborhood.
HOME OWNERSHIP is incentivized because neighborhoods with high ownership have benefits to society, because OWNERS actually care about their neighborhoods, improve their homes and create stability.
This is one of the few tax breaks that middle class people can take advantage of. If you want to start, take away the deduction for second homes, or limit the interest up to 500K (instead of 1million).
Want to take advantage of the tax break? Buy a house and quit whining.
AMEN! This is one of the reasons why I bought a home-for the TAXBREAK-I'm sick and tired of people whining-here's another example of screwing the middle class.
Wow, you're as bright as burned out bulb. Renters are enjoying lower rents because the landlords are able to deduct the mortgage interest. Don't think for a second that rents won't be jacked up if the landlords are no longer allowed interest deductions. They will pass those costs along.
I never said renters are poor people so stop putting words in my mouth. People choose not to purchase homes for various reasons and may have nothing to do with "wealth".
Here here !!!! Bravo. There are so many points made in such a tiny amount of words!! (I wish I possessed that talent )
When taxes are raised ... any tax ... it all rolls down hill and negatively impacts those least able to afford it. The fact is, if taxes were an effective means of wealth redistribution, as so many leftists firmly believe, why, after all of these years, is there no sign of it working? The rich are richer than ever before, and the ranks of the poor are growing like weeds.
If you increase any tax, it is simply passed on as a higher cost to someone else. And it's sooooooo obvious, it's painful to listen to this nonsense that we don't pay enough taxes already ..
Additionally, you are right about renters not being renters because they are poor. In Beverly Hills ... it is estimated that 60% are RENTERS. Not exactly what one would call the center of poverty. The bottom line is that the entire property ownership thing is a farce ... so long as you have to pay property taxes, YOU ARE A RENTER ... it's just a different property owner you pay your rent to. Don't pay ... or find yourself unable to afford your property taxes and you will soon meet with the REAL owner of the property you THINK is yours.
All property ownership today is an illusion ... it's not real. You are, by property deed, afforded the privilege of "equity sharing" with the government .... nothing more. Selling your "property" may net you a profit that is not available to traditional "renters", but is only a transfer of your long term "rental obligation" (property tax) to another entity.
Today, in the current decline in property values across the country, the only potential advantage to home ownership now is the MID .. because equity potential isn't there. The downside is that you are locked in, in debt, and obligated to the bank and the local government for their share of your "Rent". Remove the MID, and there is NO REASON whatsoever to "buy".
Why would you? To lock in a monthly payment amount? Perhaps ... but .. your property taxes can rise at any time ... and to any level .. so is your monthly obligation really fixed? No. Without the MID ... you're left with a long term obligation ... void for the foreseeable future of any equity potential, and paying interest on the obligation that makes your payment little more than a dent in the principle, and now at great risk of having the property value dip below the actual financial obligation for the property itself.
Even worse ... for those who think they own their property outright ... having a mortgage paid in full ... such folks are finding themselves in foreclosure actions anyway ... because their mortgages were sold to multiple entities who are coming forward with claims.
Don't believe that? Google .. homeowners being foreclosed on with paid in full mortgages.
AMEN! This is one of the reasons why I bought a home-for the TAXBREAK-I'm sick and tired of people whining-here's another example of screwing the middle class.
Another ... much needed change that will drive the leftists stark raving mad is that property tax should have some expiration date ... allowing the American people to actually own property outright at some stage in their lives.
Some combination of age and duration of mortgage paid in full ... this would protect retirees on fixed incomes from being taxed out of the homes they've lived in all their lives.
This would also generate government initiated community expansion and new property development as certain properties drop off the tax list, rather than have local municipalities simply jacking up home owners for more money every time they need more ... and sitting on their thumbs.
Until you can own your property outright, free of the threats of having your property taken away ... with zero financial obligation to the "government" ... there is no such thing as private property ownership.
Home ownership is NOT an entitlement, but judging from the lending policies encouraged by the Clinton administration, you would think it is. It's good for America if people own homes. It keeps our housing market steady (normal rate of appreciation) and keeps rents low. It encourages investors (landlords) and improvers (flippers). If you're a renter, you SHOULD want this tax break for your landlord, or else you can pay higher rents, how would you like that?
Sales tax on cars is still a deduction, as is all sales tax, if you itemize. If you are a business owner, interest is a deduction also.
If you want to own a home that is a personal decision like many others and should not be supported by the federal government. Homes used to be a place to live not an "investment" but in the last 30 years it became a speculative instrument and that is always prone to abuse as indicated in the recent history.
When people can get government subisidies for million dollar homes, second and third homes that is not money well spent but the real issue is the exclusion of a large segment of from the same benefit. To say that renters actually see this return in lower rents is unfounded and they do not get the benefit of using their home to borrow additional money for school loans, consumer loans, etc. Those tax breaks for landlords are not passed on to renters any more than tax breaks for companies are passed on to employees.
If you want to own a home that is a personal decision like many others and should not be supported by the federal government. Homes used to be a place to live not an "investment" but in the last 30 years it became a speculative instrument and that is always prone to abuse as indicated in the recent history.
How do you figure that? Real Estate has always held value as an investment for individuals and corporations alike in the USA. This is nothing "new". The speculation came with government loosening lending requirements so that those who could not afford to own a home qualified anyway, regardless of their ability to make good on their loan.
When people can get government subisidies for million dollar homes, second and third homes that is not money well spent but the real issue is the exclusion of a large segment of from the same benefit. To say that renters actually see this return in lower rents is unfounded and they do not get the benefit of using their home to borrow additional money for school loans, consumer loans, etc. Those tax breaks for landlords are not passed on to renters any more than tax breaks for companies are passed on to employees.
Renters fail to pay real estate property taxes that support municipalities and school districts. Landowners bear this burden and pass it along to the renter in the form of their rent. Do away with income, property and estate takes and institute consumption taxes for all in their place, and the burden will be equalized among the population of consumers.
I agree, get government out of the business of subsidies, mortgage, corporate, student loans, energy and otherwise! Elimination of all subsidies would go a long way to lowering government taxation and spending. Stop the insanity of robbing Peter to pay for Paul's vote.
I disagree with this. Most, if not all, people don't think about the mortgage interest deduction when they purchase a home. People generally don't want to borrow more than they have to, you end up paying like three times the purchase price of your house over 30 years if you don't have a decent down payment and a good interest rate (and even then...).
How does it push up home prices? You can't get a loan for more than the appraised value of the home. If anything, you can push up prices by paying cash since you're not at the mercy of the bank telling you what they're willing to pay. Of course, anyone who purchases a home for over market value is an idiot anyway.
I think the Realtor in your article is a dingbat, if that's truly what he thinks.
In all honesty, the deduction does not make any difference whatsoever in the decision to purchase or the purchase price.
To keep people from taking out loans they can't afford, I would support no more 100% loans, no more FHA 3% down loans, no more 80/20 loans to avoid PMI...let's just do away with PMI in general and make everyone have 20% down. Period. If you really want to reign in people who take out loans they can't afford, try the above before you want to take away the mortgage interest deduction from people who ARE doing the right thing.
If you pay cash I can pretty much guarantee you will get a lower price on a home. Buyers are willing to pay more for a house if they are taking out a mortgage, a few thousand over 30 years is insignificant. Very few economists would argue that the deduction inflates the price of a home.
Completely agree on the 20% down actually the amount was greater in the distant past, hopefully they learned their lesson. Hard to believe there was actually a time when homes were bought entirely by cash.
unfortunately, as renters we have very little clout.
this interest deduction is basically a subsidy towards people who have huge mortgages in expensive, high-ownership locations like Nevada, Arizona, California and New Jersey.
unfortunately, as renters we have very little clout.
this interest deduction is basically a subsidy towards people who have huge mortgages in expensive, high-ownership locations like Nevada, Arizona, California and New Jersey.
I was surprised but actually you are in the majority, its more than just renters, people that paid off their mortgages, young people living at home. You are in the majority because 75% of personal tax returns do not claim the mortgage interest deduction.
If you want to own a home that is a personal decision like many others and should not be supported by the federal government. Homes used to be a place to live not an "investment" but in the last 30 years it became a speculative instrument and that is always prone to abuse as indicated in the recent history.
When people can get government subisidies for million dollar homes, second and third homes that is not money well spent but the real issue is the exclusion of a large segment of from the same benefit. To say that renters actually see this return in lower rents is unfounded and they do not get the benefit of using their home to borrow additional money for school loans, consumer loans, etc. Those tax breaks for landlords are not passed on to renters any more than tax breaks for companies are passed on to employees.
How is it abusive to see a place where you can make an improvement and seize the opportunity? Flippers were part of the problem because it became the trendy thing to do, but honestly, those homes are in much better shape now and that probably helped revive many neighborhoods where property values were stagnant. I don't know of any time when owning a home was not inherently a good investment. People may not have bought for that specific reason 30 years ago (and who's to say they weren't, anyway?) but the fact remains that owning a home used to be one of the best investments you could make.
It's not really a subsidy to get a MID. If you have the means to own multiple houses (some of which may be used as rentals), more power to you. That has no bearing on anything in this discussion.
This is yet another war on the rich by the liberals, who think nobody deserves to have a nice life while poor people exist.
I was surprised but actually you are in the majority, its more than just renters, people that paid off their mortgages, young people living at home. You are in the majority because 75% of personal tax returns do not claim the mortgage interest deduction.
Probably because you have to itemize to claim the MID. If half of "taxpayers" don't in fact pay any taxes at all, there's 50% of people most likely not claiming the MID. It's really no surprise, if your 75% statistic is even accurate.
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It's good for America if people own homes. It keeps our housing market steady (normal rate of appreciation) and keeps rents low. It encourages investors (landlords) and improvers (flippers). If you're a renter, you SHOULD want this tax break for your landlord, or else you can pay higher rents, how would you like that?
