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April 26, 2005
Getting Rid of the Mortgage Interest Deduction
So, what would happen if the home-mortgage deduction were slowly phased out? For the sectors of the housing market where homeowners tend not to itemize deductions, the impact would probably be minimal. At the higher end, housing prices might be expected to adjust, but not to crash. Consider a home buyer in the 25 percent tax bracket with an 8 percent mortgage. Thanks to the interest deduction, he effectively pays 6 percent on the mortgage. Losing the deduction would have the same effect on his personal finances and mentality as a rise in mortgage...
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Posted on April 26, 2005 06:26 AM by House 78.
Filed in Mortgage Calculator under housing prices.
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