We almost forgot the largest govt subsidy for the REIC: mortgage interest deduction.
If someone wants to claim that this doesn’t affect commissions for individual agents, please explain why the NAR is fighting so hard to keep the MID.
……………
“The National Association of Realtors wants lawmakers to preserve some type of government-guarantee for the secondary mortgage market as it moves forward with housing finance reforms, the association’s president Ron Phipps said in a podcast Thursday.
Phipps said his organization has representatives in Washington fighting to preserve mortgage interest deductions and the standard 30-year, fixed-rate mortgage.
NAR’s concerns — like those of many homeownership advocacy groups — rose after the Treasury Department revealed mortgage finance reforms that envision a private-sector led market with very limited government-guaranteed loans. NAR’s concerns about the changes mirror those of small community banks.
“A reliable secondary market is essential so that the nation’s Main Street community banks can continue to offer residential mortgages to their customers,” according to Jim MacPhee, chairman of the Independent Community Bankers of America. “While reform should focus on preventing future crises in the housing market and embracing the common-sense underwriting standards long practiced by community banks, it should not eliminate all government involvement in the secondary market while turning it over to Wall Street,” MacPhee said following the Treasury’s proposals were announced.”
Whether the MID simply causes buyers to pay more for housing (assuming prices are dynamic and respond to things like interest rates and the MID) or if it causes taxpayers to subsidize the housing industry (assuming prices are static and taxpayers are paying a portion that the buyers/owners would otherwise be paying), it is costing taxpayers and/or consumers more money.
It is costing us (taxpayers and/or consumers — however you choose to look at it) around $100 million per year, IIRC.
[edit: I meant $100 Billion — with a “B” — not million. But looking at the numbers, it is actually more than that.]
