[quote=briansd1]
It’s all about the monthly payments. Pure and simple, if the monthly payments, net of taxes, are reasonable, people will buy houses.
[/quote]
There is a natural floor in the cost of housing as percentage of income. The prices would not go down to fully offset the cost of deduction (even if that was the case the revenue generated would be lower since the basis would be lower). I expect transition into some sort of European system where mortgages are often 3-5 years with balloon payment that usually gets refinanced into another term. The ownership rate is lower (Germany has just over 40% ownership rate), but tenants are more protected then here. I received a 10 (ten) year notice after the ownership of the building changed while I was living as a renter in Germany. It is quite common for people there to do major remodels of their rentals and to stay in the same rental for decades.
