Realtors fear tax break elimination could hurt housing industry - WLOX.com - The News for South Mississippi

Realtors fear tax break elimination could hurt housing industry

OCEAN SPRINGS, MS (WLOX) -

By Doug Walker – bio | email

OCEAN SPRINGS, MS (WLOX) - Eliminate or reduce the home mortgage interest deduction that most Americans enjoy. That's the recommendation of a specially appointed presidential commission on deficit reduction. 

But some coast realtors say it's an idea that could seriously damage the already troubled housing industry.

"Mortgage restrictions have tightened, insurance rates have gone up, taxes have gone up," Realtor Lisa Hollister said.  "You ride around and you see homes that have been for sale for quite a while. 

If the federal government reduces or eliminates the mortgage interest deduction, what would happen?  Realtor Chester Harvey has an answer.  

"I think it would be devastating to everyone, down to the individual with their first house to the person who has a million dollar house," Harvey said.  "I mean, people count on that deduction and for some people that's the only deduction that they have." 

If the tax break disappears, Hollister said an ideal that Americans hold sacred will disappear as well.  

"I just can't imagine that the government, I know they need money, I know we're in debt, but why would they take away our American dream?" Hollister asked.  

Coast realtors that I talked to say that if this proposal passes, if it is given consideration, it would open the door to a devastating blow on this industry, and they plan a strong lobbying effort in Washington, D.C.

"I'm sure that the National Association of Realtors already have their lobbyists in place fighting this," Harvey said. "In fact, just as they have been fighting for all perils insurance.  We have a very strong lobby in Jackson and in Washington D.C." 

If the deduction goes away, realtors say "For Sale" signs will be around a lot longer, and you won't see much home construction happening either.    

Before any changes take place, the plan would have to be approved by Congress, and that is far from certain.  Some Republicans say the proposal is already dead on arrival at the Capitol.

Copyright 2010 WLOX. All rights reserved.

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