Interesting column from BloombergView wonders whether recovering housing prices is a good news-bad news conundrum.
“This simple truth explains a lot about public policy surrounding housing in the U.S. The home mortgage interest deduction is a subsidy for the affluent that serves no discernible economic purpose, but is almost impossible to get rid of because removing it would
raise taxes for those with mortgages and
depress home prices across the board. Zoning and other land-use regulations have been accused (and to some extent convicted) of segregating Americans by income and slowing U.S. economic growth, but it’s almost impossible to get rid of them because they raise the price of existing homes”.