Homeownership Tax Change Would Harm Seniors

By Marc Burkholder

President

Home Builders Association of the Grand Traverse Area, Inc.

For many Americans, getting married, buying a home, having children and providing them with an education, then being able to retire comfortably without financial worries is the embodiment of their American Dream.

Homeownership has long been the foundation of a family’s ability to achieve their American Dream. For more than a century, Americans have counted on their investment in their homes to be able to pay for their children’s education and to enable them to live where and how they want to after they retire.     

But those expectations are in jeopardy for the nation’s 75 million home owners. Policymakers seeking to reduce the federal deficit are considering eliminating or reducing the mortgage interest deduction. Changes to the deduction would not only harm home owners who currently rely on it to manage their household expenses, it would also hurt millions of seniors who no longer claim the deduction but still depend on its existence to secure their future.

According to most economists, eliminating or scaling back the mortgage interest deduction would trigger a drop in home values. This would cause more home owners to be saddled with mortgages that are larger than their property’s value, which would lead to even more foreclosures and place even more downward pressure on home prices.

Seniors looking to use the proceeds from the sale of their home to relocate to a different part of the country, to move into a retirement community, to help defray health care costs or to fund other long-term obligations would find they have a much smaller retirement nest egg than they’d planned on. They may be forced to keep working for many more years, or to postpone or cancel moving to a new home because they can’t afford or are unable to sell their current home.

Changing the rules now by eliminating or curtailing the deduction would be unfair. It would take money out of the pockets of those home buyers who counted on the deduction being there when they needed it, and it would penalize millions of baby boomers nearing retirement and seniors who own their homes outright.

Seniors have played by the rules and made sacrifices to get where they are, and they don’t deserve to have the rug pulled out from under them. Learn more about the threat to the mortgage interest tax deduction and find out how you can take action to protect it at www.SaveMyMortgageInterestDeduction.com, or contact the Home Builders Association of the Grand Traverse Area, Inc. by calling 231.946.2305