LA Times - 10.8.2005 - Tax Reformers Eye Breaks for Housing
This article rightfully calls the mortgage tax deduction a "sacred cow" and there is virtually no chance of it being eliminated. However, there is a very good chance that the deduction for second homes and home equity borrowing could be reduced or eliminated. This would have a huge impact on the economy in general and the housing market specifically.
In the last 5 years many baby boomers have begun buying second homes that will eventually be used to retire in. This increased demand would be significantly dampened if the tax deductibility of the 2nd home was eliminated.
With a policy change this significant, there is no need to worry about changes coming soon, but this is definitely an issue that bears watching.
Comments