The National Association of Home Builders kicked off National Homeownership month, which President Donald Trump announced last week, by voicing its concerns over the House Republicans’ tax plan.
According to the association, about 66% of Americans believe owning a home is an essential part of the American Dream.
“Americans continue to place a high priority on homeownership and work hard to achieve this goal for their families,” NAHB Chairman Granger MacDonald said. “Our members are committed to providing high-quality homes that meet the diverse needs of Americans across the country.”
NAHB stressed that the mortgage interest deduction has been a cornerstone of American housing policy since the inception of the tax code. The deduction primarily benefits middle-class taxpayers, according to data from the Congressional Joint Committee on Taxation.
Under Trump’s tax reform, this deduction would be endangered. The plan takes away many deductions, but the mortgage tax deduction isn’t one of them. However, it may not mean much as the new tax plan would nearly double the standard deduction from $6,300 for singles to $12,000.
For married couples filing jointly, the most common homeowner group, the standard deduction would increase from $12,600 to $24,000, according to a detailed analysis from the Tax Foundation Fiscal Fact. Thus, the mortgage tax deduction would become irrelevant as the standard deduction would be the most beneficial.
“We must support the dream of homeownership and not create barriers through unnecessary federal regulations or tax code changes,” MacDonald said.
NAHB also pointed out the need to lessen regulations that are driving up the cost of housing.
“We have long fought for sensible reforms to burdensome regulations that needlessly increase the cost of homes for low- and middle-income families,” said MacDonald, noting NAHB research that shows government regulations add about 24% to the cost of housing.