Stop Distorting the Housing Market

Part 17 of... "6 Tax Breaks Landlords Get that Hurt the Economy and You"

We need a tax system that distorts the housing market less and lets the free market work better. 

The goal is to stop the government from distorting the market for single-family houses and condos.

If we stop the landlord subsidies, the economy and family wealth will grow a bit faster every year – year after year. And the growth will be much more stable with smaller real estate booms and busts, and smaller and shorter recessions after the busts. More families will own the single-family houses and condos they live in. And after the transition period, this will cost the government nothing, year after year.

The best time to stop distorting the housing market was decades ago. 

The Great Recession wouldn’t have been “Great” if we didn’t have all those investor tax breaks.

The second best time to stop distorting the housing market is now. 

Much of the transition would be finished by mid-decade while the demographics of the U.S. housing market are still strong.

Next

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All

Part 1 – 6 Tax Breaks Landlords Get that Hurt the Economy and You

Part 2 – Depreciation Tax Deduction – (Tax Deferral)

Part 3 – 1031 Exchange – (Tax Deferral)

Part 4 – Mortgage Interest Tax Deduction – (Tax Reduction)

Part 5 – Tax-Free Landlord Profit – (Tax Deferral)

Part 6 – Taxes on Capital Gains are a Lot Lower Than Taxes on Ordinary Income – (Tax Reduction)

Part 7 – Stepped-Up Tax Basis – (Tax Reduction)

Part 8 – 6 Distortions of the Housing Market

Part 9 – 2 Sets of Rules for Single-Family Houses

Part 10 – Fixed Supply of Single-Family Houses

Part 11 - Houses for Homes, Not Tax Shelters

Part 12 - Solutions

Part 13 - Permanently Increase Economic Growth

Part 14 - Life is Crazy Enough

Part 15 - The Hardest Part

Part 16 - Distorted Back to Reality

Part 17 - Stop Distorting the Housing Market

Part 18 - Conclusion