Economist For Realtors Group Discusses Mortgage Deduction

They talk about why Realtors are concerned about proposed changes to the home mortgage interest deduction. Realtors In the last election cycle, Real Estate PACs spent $9 million evenly divided among Republicans and Democrats. So what groups like the National Association of Realtors, which is the biggest in the real estate lobby, say really counts in Washington. And Jed Smith is managing director of quantitative research with the group. Of the 75 million homeowners, approximately two-thirds of them in this country have a mortgage and the majority of those people take a deduction. They have to be able to itemize their income taxes, and the bigger the tax bracket you're in the greater benefit you have. Why should lower-income homeowners subsidize wealthier people. And 91 percent of the people make less than 200,000 a year. Furthermore, homeowners pay somewhere between 80 and 90 percent of all the personal income taxes in this country. So, while it is a subsidy, it's maybe the only subsidy that most of these homeowners receive. Actually, we find that two-thirds of the people living in apartments support mortgage interest deduction. I think that may very well be because homeownership in this country is sort of the American dream and everyone sees the advantage of the current system. If everybody is getting cut, why shouldn't people with mortgages. We think, however, that there are a lot of social advantages to having a nation of homeowners. And people who own houses tend to have better financial situations; their children tend to do better in school. There are all sorts of social advantages to society as a whole as well as the obvious economic advantages. It doesn't make them that much more secure to own the home. And we think that goes a long way towards helping them move along and realizing the American dream. I mean, do we think -Jefferson didn't think in terms of having the beach house, the condo in Vail. And so that's a totally different type of business. And then you have to look at this in terms of does it make economic sense, and it appears to be that way. But right now the major emphasis has been on the first home and we really haven't gotten into that other issue. Smith, thank you very much for talking with us today. No quotes from the materials contained herein may be used in any media without attribution to National Public Radio. This transcript is provided for personal, noncommercial use only, pursuant to our Terms of Use. Visit our permissions page for further information. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio. Login / Register More information is required for you to participate in the NPR online community. We may edit them for clarity or brevity and identify authors by name and location. Louis area who started 2011 unemployed and searching for work.