Tag Archives: Mortgage Interest Tax Deduction

America's Homeowner Alliance announced this week that it is officially open for membership. Launched by a team of industry veterans led by Phil Bracken and guided by an advisory board made up of representatives from the housing industry, prominent consumer groups, and fair housing organizations, America's Homeowner Alliance is the first nationally organized group dedicated to protecting and promoting sustainable homeownership for all segments of America.

As debate continues to swirl around the future of the mortgage interest tax deduction, Pew Charitable Trusts released a study revealing the geographic impact of the tax deduction. With 37 percent of all filers claiming the mortgage interest tax deduction, Maryland had the highest claim rate in the country, according to data from 2010. The lowest claim rate occurred in West Virginia and North Dakota, where 15 percent of filers claimed the deduction.

As Washington engages in a standoff over budgetary proposals to avert the fiscal cliff, several industry professionals and associations are calling upon lawmakers to avoid slaughtering what was once thought to be a sacred cow: the mortgage interest tax deduction (MID). While many housing professionals view the deduction as a break for homeowners and an incentive for others to purchase their own homes, critics call the MID a ""subsidization of the real estate industry."" Now that the MID is on the bargaining table, a number of people are speaking up in defense of it.

Clear Capital released a new market report Tuesday, tracking home prices through the end of November. Nationally, quarterly price gains were cut by more than half compared to readings from the month before. For November, home prices edged up just 1 percent. Even with fewer fair market sellers listing their homes, Clear Capital says REO sales held steady at 18.4 percent of total sales--a level that will put minimial pressure on home prices should it hold through the winter months.

About 56 percent of respondents to a recent survey by the National Low Income Housing Coalition said they support replacing the current mortgage interest tax deduction with an alternative that offers the same percentage deduction to all homeowners without taking income into account. The survey of a little more than 1,000 Americans also found that 63 percent believe tax deductions should only apply to those whose mortgages are $500,000 or less. The same percentage said the federal government should use savings it would incur from revising the mortgage interest tax deduction to end homelessness.

A strengthening housing market in the past few months has economists making more bullish predictions about the recovery, Zillow revealed Thursday. The company released the results of its most recent Home Price Expectations Survey, showing that economists surveyed expect home prices to rise by a total of 2.3 percent during 2012. This change in sentiment is a major turnaround from June, when respondents predicted home prices would experience a net decline this year.

A group convened on the steps of the South Carolina State House Thursday to express their support of homeownership and opposition to policy changes that might threaten the American Dream. The outlook expressed at the rally mirrors widespread sentiment uncovered in a recent industry survey. About three-fourths of American voters said it is ""appropriate and reasonable"" for the federal government to promote homeownership through tax incentives.

After much hype about the possibility of an elimination of the mortgage interest deduction (MID) as part of the debt ceiling agreement, the August 2nd accord included no such provision. However, the new law does call for major deficit reductions -- $2.4 trillion total -- to go into place over the next several years. A $917 billion reduction over the next 10 years is automatic. An additional $1.5 trillion reduction must be decided by November 23rd. The bipartisan committee dedicated to determining those cuts could find the MID an easy target.

What many consider to be a staple of American homeownership is expected to be on the chopping block as lawmakers look to trim the nation's deficit. The prized mortgage interest tax deduction has been part of the federal tax code since 1913. Currently, it costs the U.S. Treasury an estimated $94 billion a year. Congress has tossed around several proposals for amending this part of the federal tax code, including lowering the debt limit to $500,000 on first mortgages. Such a move is estimated to return between $5 billion and $15 billion.

The International Monetary Fund (IMF) has some pretty direct words for the American government and its handling of the U.S. housing crisis. In an annual report that will be released next week, IMF says the origins of the global financial crisis can be found in the U.S. housing finance system. The agency says government participation in the U.S. housing market has been ""pervasive"" but has not yielded the expected benefits to prospective or existing homeowners.