Economists agree the mortgage deduction fails to boost homeownership.

Evidence

However, economists generally agree that the mortgage interest deduction does virtually nothing to encourage people to buy homes. Instead, research suggests that it rewards a behavior that was probably going to occur anyway (again, like marriage). But it does change two associated behaviors. First, the tax deduction encourages homebuyers to purchase larger and more expensive homes, so they can maximize the deduction. That behavior creates a market response that increases home prices in general, making it more difficult for first-time homeowners to be able to afford to purchase. (If you’re reading this and wondering who, exactly, does think the mortgage deduction is a good idea, the answer is realtors, developers, and their lobbying groups.) — Dorothy A. Brown, Getting to Reparations, 1242

Categorization

• XREF: Marries to the Whiteness of Wealth diagnosis and to the book’s broader theme of benefits flowing to whites; connects to the 2017 TCJA structural shift discussed in following paragraphs.
• SEED: Angle: ‘the folk legend tax break’ — a popular subsidy that economists and preservationists defend while it mostly inflates prices and hurts first-time buyers.