This article originally appeared at the Hallmark Abstract Service, New York website here.
The Mortgage Interest Deduction!
Of course the title of the article is a parody of the parody from a fan pleading for the masses to leave Britney Spears alone but, for anyone who owns real estate that is mortgaged or who may be thinking of buying residential property with financing, the title is actually quite significant.
This is the case because when the revenues of the federal government are too low or expenses too high (or additionally is we are in the silly season of campaigning for an election), reducing or completely eradicating the mortgage interest deduction (MID) benefit always seems to find itself back on the table.
Some say the MID is simply a loophole that only benefits the wealthy as they will typically itemize deductions while others say that in reality it doesn’t achieve the goal of expanding home ownership.
Given all of that, we would say that altering, reducing or eradicating the MID will rightly or wrongly change the psychology of the real estate market and its players and have the effect of slowing down or reversing whatever housing recovery we are currently enjoying!
An alternative? How about the federal government reigning in spending while at the same time finding new and improved ways to move GDP up from the latest report that showed an increase of .1% or for all intents and purposes, 0. That would certainly increase revenues.
Source: RISMedia.com
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