Representative Keith Ellison (D-MN), Senator Jeff Merkley (D-OR), and NLIHC hosted a congressional briefing on October 17 to discuss the benefits of reforming the mortgage interest deduction (MID) through tax reform and why Congress should reinvest savings generated from MID reform into housing affordable for people with extremely low incomes.
NLIHC and the Institute on Assets and Social Policy (IASP) at Brandeis University announced at the briefing the release of a new policy report, Misdirected Investments: How the Mortgage Interest Deduction Drives Inequality and the Racial Wealth Gap. The report explores how the MID promotes racial and economic inequality by benefitting mostly wealthy, white households and represents a loss of $8 billion in housing investment for families of color.
NLIHC President and CEO Diane Yentel began the panel by outlining the NLIHC-led United for Homes campaign that calls for a rebalancing federal housing investments through MID reform. She emphasized that the current Republican tax plan to increase the standard deduction would make the MID even more regressive than it is today.
Nela Richardson, the chief economist for Redfin Corporation, explained how the MID, as it is currently structured, does not help working and middle class families afford homes. She stated that MID reforms could benefit the housing market by incentivizing lower income home buyers and increasing renters’ ability to save for a home.
Tatjana Meschede, the associate director of IASP and one of the authors of Misdirected Investments, shared data on the stark racial and ethnic disparities among those who benefit from the MID. (Read the details in a related article in this edition of Memo to Members and Partners.)
Professor Mechele Dickerson of the University of Texas spoke about the racial inequities between households that from the MID compared to households who receive federal housing assistance through HUD.
Dr. Megan Sandel, a pediatrician and principal investigator at Children’s HealthWatch, described how safe, affordable housing saves billions of dollars long-term in health costs for children and families. She encouraged Congress to ensure any savings generated by MID reform are reinvested in housing solutions for families with the lowest incomes to improve their health outcomes.