Tuesday, January 16, 2018
Business

The Nation's Housing: Polls unclear on mortgage interest, property tax deductions

Polls on mortgage, tax write-offs mixed

WASHINGTON — In the congressional and White House negotiations on tax reform — including the mortgage interest and property tax deductions — who has the crucial political advantage of counting documented public opinion on their side?

Is it the real estate and building lobbies who argue that maintaining federal tax benefits are essential, given housing's key role in job creation, household wealth and the fact that real estate is still in a fragile state coming out of the recession and mortgage bust?

Or is the "cut the debt" proponents and economists who see mortgage write-offs as unnecessary, costly and heavily tilted to favor upper-income owners?

In debates on tough issues like these, advocates invariably point to public opinion surveys that show members of Congress where their constituents stand, and implicitly how they should vote. That process is already well under way on Capitol Hill as the tense debt, tax and budget negotiations head toward the Dec. 31 deadline.

But the polls can be confusing. On the one hand, a new survey by National Journal, a publication widely read on Capitol Hill, found larger numbers of Americans willing to limit both the mortgage interest and property tax write-offs than housing proponents suggest.

The poll of 1,001 adults, jointly sponsored by United Technologies Corp. and released Dec. 11, found that 41 percent of respondents favor reducing the deductions for all homeowners, no matter their income, and another 21 percent favor limits on taxpayers earning more than $250,000 a year. Just 31 percent favored retaining the current system, which allows write-offs on up to $1.1 million in mortgage and home equity debt on primary and secondary homes.

The same survey found roughly similar opinions on the property tax deduction: 42 percent said they favor limiting it for all owners, 19 percent support reducing it for high-income households, and 31 percent favor no change in the system.

How to interpret these results? One way is to conclude that despite the housing industry's claims to the contrary, there appears to be noteworthy public opinion support for reducing current mortgage interest and property tax benefits, especially for taxpayers with the highest incomes.

Earlier this year, the National Association of Home Builders commissioned a survey of 1,500 likely voters by a bipartisan pair of pollsters — Republican-leaning Public Opinion Strategies and Democratic-leaning Lake Research Partners. That survey found that 73 percent of respondents were either strongly or moderately opposed to eliminating the mortgage interest deduction and 62 percent opposed any reduction. The same poll found that 54 percent opposed new mortgage deduction limits on households earning $250,000 or more.

On Dec. 13, the Pew Research Center released a national sampling of 1,503 adults. Although a majority of Americans favor limits on tax write-offs in general, and 69 percent favor raising tax rates for households earning $250,000 and up, only 41 percent support cutting back on mortgage interest deductions; 52 percent are opposed. Among Democrats, 45 percent favored limitations. Among Republicans, just 35 percent were willing to support cutbacks.

Jerry Howard, CEO of the National Association of Home Builders, argued in an interview that multiple public opinion polls consistently have shown that a majority is opposed to limiting mortgage interest and other deductions. "There's no question," he said, and the politicians on Capitol Hill should give heavy weight to the public's views on the subject.

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