Godfrey Wood’s Feb. 26 letter rightly highlights the absence of governmental assistance for “income-challenged families” to attain homeownership. However, the letter crucially omits any discussion of how existing tax policy subsidizes homeownership for our highest-income households.

The two largest subsidies for homeownership are in the federal tax code – namely, the mortgage interest deduction and the capital gains exclusion on sales of principal residences. In its Dec. 19 Estimates of Federal Tax Expenditures for Fiscal Years 2019-2023 (JCX-55-19), Congress’ Joint Committee on Taxation estimated the fiscal year 2020 cost of these two programs at $30 billion and $36 billion respectively, for a total of $66 billion.

In contrast, that same document estimates the fiscal year 2020 cost of the nation’s largest affordable rental production program, the Low-Income Housing Tax Credit, at $9.4 billion. HUD’s fiscal year 2020 budget for rental assistance and production programs is roughly $45 billion. In short, federal subsidy for homeownership through tax deductions alone exceeds subsidy for affordable rental housing by roughly $11 billion per year.

Furthermore, these subsidies primarily benefit wealthy households. The Joint Committee on Taxation found that 64 percent of households that claim the mortgage interest deduction have incomes over $200,000 a year. These federal incentives are also provided by the state of Maine via these tax provisions conforming to federal law.

Rather than pitting the need for affordable homeownership against the need for affordable rental housing, Mr. Wood should be advocating for redirecting current subsidies for our richest homeowners to folks of modest means looking to purchase their first home.

John Anton

Portland

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