Why Buy Land Now?

Both presidential candidates appeared to favor keeping all three homeowner tax breaks “as is,” though information was sparse on the deductibility of property tax and the capital-gains exclusion.

The Big Three only benefit those who itemize deductions. Itemization increases significantly as income rises. McCain is against a mortgage tax credit for families who don’t itemize. Obama favors a ten percent “universal” mortgage credit for non-itemizers.

These deductions help many Americans. Bruce Hahn, President of the American Homeowners Grassroots Alliance, told me: “The mortgage-interest and real-estate tax deductions and the home-sale capital-gains exclusion encourage home ownership, which contribute to social stability and the accumulation of home equity, the biggest source of retirement savings for most Americans. Existing ceilings…and other limitations…prevent these worthy deductions from disproportionately benefiting the rich.”

Critics argue The Big Three are regressive, inequitable, inefficient and expensive. William G. Gale, et al., “Encouraging Homeownership Through the Tax Code,” Tax Notes, June 18, 2007.