2 Sets of Rules for Single-Family Houses

Part 9 of... "6 Tax Breaks Landlords Get that Hurt the Economy and You"

Jun 19, 2021

Tax breaks for landlords don’t distort the market for apartments the same way they do for single-family houses because all apartments are owned by landlords. All apartment owners face the same tax system.

Single-family houses are different.

The problem is landlord owners face a completely different tax system than live-in owners, but live-in owners have to compete directly with landlord owners – and all their tax breaks – when live-in owners buy single-family houses and condos for their families to live in.

Landlord owners are not only displacing live-in owners, but they’re also destabilizing live-in owners financially. Real estate booms and busts are a lot larger with investors jumping into and out of the market. The result is more unstable wealth for the American families that do own their own homes.

The home ownership rate isn’t much higher today than in the 1960s despite real median family income being 50% higher. That’s because landlord income has increased as well due, in large part, to the landlord tax breaks. Without the landlord tax breaks, the U.S. home ownership rate would be higher today.

It’s gotten so bad now that some large landlords are actually buying up entire subdivisions of brand new, single-family houses and turning them into rentals. That’s how big the government giveaways are to landlords.

If landlords want all those crazy landlord tax breaks, no problem, they should buy apartments where all owners face the same crazy generous tax system.