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Originally posted by Mmmm, Burger (C.J.)
how--because people would pay cash otherwise? Or because people take out larger mortgages?
The real problem with eliminating it is that it would depress home values, and with 67% of americans owning homes, that's a pretty good constituency.
The only way to get rid of it without massive displacement is to phase it out--e.g., drop 5% of the deduction each year for 20 years (so only 95% of interest is deductible this year, 90% the following year, and so on)
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Amen. Right now, it truly serves no purpose for the homeowners - it's priced into home values completely. And an abrupt end would be painful - like killing rent control in one day would be. We need to be weaned off of it - all it does now is make people think they're getting some benefit. They're not.
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