It the top Republican on Senate Finance says it's going to happen, chances are it will--at least in some form. I don't have a rental property, but for those who do (or who are thinking of buying one), if you couldn't deduct the mortgage, would it change your behavior regarding the property?
Limiting the deduction to the first $1million of personal residence is something that many could fathom, of course the GOP elite will be pissed, but the commoners can agree that this fair as it does not affect them.
Yep, the only reason this thing exists is because it created some job for realtors...I agree that the tax deduction is silly, and should be phased out and then eliminated. It is essentially a government subsidy to the housing industry and a regressive tax policy with the benefits going to the wealthy and those in expensive housing markets. In the short term eliminating the deduction would destabilize prices, particularly on more expensive homes.
It's a silly deduction, and it will probably be around forever.
I'm not sure when owning a house, became a right, as opposed to a privilege.What does that have to do with the tax code?
Mortgage interest on owner occupied primary residences hasn't been tax deductible in Canada, and our housing market is healthy.
That said, the deduction was not created to give realtors jobs. This article gives the history (http://www.nytimes.com/2006/03/05/magazine/305deduction.1.html?_r=3&pagewanted=all).
I'm not sure when owning a house, became a right, as opposed to a privilege.What does that have to do with the tax code?
Mortgage interest on owner occupied primary residences hasn't been tax deductible in Canada, and our housing market is healthy.
The two are not related, and don't be so sure your housing market is healthy.....do a quick search and you will see that Canada is largely viewed to be in bubble territory and one of the most overvalued in the world and canadians debt to income is at all time highs. So signs are flashing red.....it doesn't mean a crash is coming but it will pause and probably slightly decline as the CAD govt tightens lending requirements.
We have a much healthier housing market, in comparison to the US market. I don't think that's really such a stretch, given the fact that we haven't experienced the housing crash you did. The mortgage rules have already been tightened, and they've done it gradually, which seems to have stabilized things somewhat.
They contemplated making people re-qualify for their mortgages, at renewal, but that has been dismissed, for now.
A big difference between Canadian and American mortgages, are the terms. The interest is only fixed for a portion of the loan time (1,2,3,5,7,8,10 years depending on the mortgage option) and when that interest rate expires, you have to re-negotiate the interest rate. We've never been able to just lock into a 30 year, fixed rate mortgage.
So whether or not you plan on buying or selling - if you have no mortgage then who cares, and if you have a mortgage you are succeptible to rate reset (what would a 2-3% increase in rate do to your payments) but if you can afford it who cares, all that does not dismiss that the CAD housing market is uncharted territory and contains far more risk than conservative canadians like to admit, especially after they and their banks thumped their chests and told the rest of the world how smart and conservative they were. Stop trusting your politicians and CAD pride and study the statistics - they are all very similar to the US in 2007.
The tax code is designed to encourage people to make decisions, inline with the government's values, which seem to include almost every citizen being a home owner. The way that the US banking institutions were giving mortgages to anyone who had a warm breath, further indicated it.Okay, but what do banks have to do with rights? Obviously homeownership is something many Americans value, and for good reason, but I don't see how you're making the jump from that to it being a right unless it was empty hyperbole.
CMHC insures all non-conventional mortgages (less than 20% down), and I don't think you guys had that in the US, but I might be wrong.Yeah, we've got that. (http://en.wikipedia.org/wiki/Private_Mortgage_Insurance) And I wouldn't be so sure that government sponsored enterprises are safe and rock-steady, either.
If my interest rate went up 3%, my payments would go to $171/week, hardly soul-crushing, considering that is including a bonus 40% prepayment every week.