I think about how recently and spectacularly housing has gone off the rails and I get so sad. What a complete disaster this is turning into.
How Homeownership Became the Engine of American Inequality
51–60 of 222 posts
Re: How Homeownership Became the Engine of American Inequality
#52"How the kulaks became engines of Soviet inequality"
Re: How Homeownership Became the Engine of American Inequality
#53"It is difficult to think of another social policy that more successfully multiplies America’s inequality in such a sweeping fashion." Tax deduction for employer-insured healthcare?
Carried-interest loophole?
Re: How Homeownership Became the Engine of American Inequality
#54You can go back further, start around the 1930s, and see housing policies/practices that didn't just drive inequality, but also segregation[1]. I was shocked (pardon my ignorance).
1 - https://www.amazon.com/Color-Law-Forgotten-Government-Segreg...
Re: How Homeownership Became the Engine of American Inequality
#55So this article advocates for the removal of the mortgage interest tax deduction, because subsidizing home ownership leads to a larger economic divide between owners and renters. As a renter, I appreciate the intent, and I also appreciate any measure to simplify the tax code. That said, I also see compelling arguments in the deduction's favor. The sad truth is that most Americans are terrible at saving and in very po…
It might make more sense to kill the tax break on properties north of $1m and shift that to relief for renters under a certain income threshold.
You'd leave in place the break for the majority of middle-income wealth builders, close yet another loophole for the wealthy, and enrich lower income renters.
It would never ever happen with our current political climate (money is influence), but I feel like it would make sense. As the article mentions, a complete repeal of MID would be even more difficult.
Re: How Homeownership Became the Engine of American Inequality
#56What's done in Europe?
Re: How Homeownership Became the Engine of American Inequality
#57When I crunched the numbers for the mortgage interest deduction it really didn't seem that compelling. It replaces the standard deduction so the first 12,500$ in mortgage interest does nothing for you. After that it's just a minor reduction in taxable income and your tax burden is only reduced by a fraction of your mortgage interest. Not enough to cover the costs of maintaining a home and the tendency to consume more…
The MID barely cancels out my property taxes. Imagine if your investment accounts had to pay 1% tax every year based on its current worth even if you didn't realize any profits.
Sounds like a lot of mutual funds...
Re: How Homeownership Became the Engine of American Inequality
#58I don't know of anyone who bases a home purchase decision on the mortgage interest deduction. Seriously location, school district, cost of home, time to commute, yard size, cost of HOA are all more important to everyone I know. In fact it has never come up in conversations about home purchases with my peer group.
It's one of the big reasons I want to purchase a home right now. My effective tax rate was 27% last year and I feel like I'm burning my money by renting.
Re: How Homeownership Became the Engine of American Inequality
#59So this article advocates for the removal of the mortgage interest tax deduction, because subsidizing home ownership leads to a larger economic divide between owners and renters. As a renter, I appreciate the intent, and I also appreciate any measure to simplify the tax code. That said, I also see compelling arguments in the deduction's favor. The sad truth is that most Americans are terrible at saving and in very po…
It might make more sense to kill the tax break on properties north of $1m and shift that to relief for renters under a certain income threshold. You'd leave in place the break for the majority of middle-income wealth builders, close yet another loophole for the wealthy, and enrich lower income renters. It would never ever happen with our current political climate (money is influence), but I feel like it would make se…
Interest is only deductible on the first $1m of a loan already.
Re: How Homeownership Became the Engine of American Inequality
#60I don't know of anyone who bases a home purchase decision on the mortgage interest deduction. Seriously location, school district, cost of home, time to commute, yard size, cost of HOA are all more important to everyone I know. In fact it has never come up in conversations about home purchases with my peer group.
It also has an indirect effect. Because it exists, it alters the prices of what exists on the market even if it doesn't change the individual (go / no go) or selection choice.