Rep. Keith Ellison, D-Minn., has introduced the Common Sense Housing Investment Act, which proposes to convert the mortgage interest deduction to a 15% flat rate tax credit on mortgages up to $500,000. Ellison, citing Tax Policy Center data, says that by converting the mortgage interest deduction to a 15% credit, 60 million homeowners would receive the tax credit, up from 43 million.
‘The lack of affordable rental housing is one of the greatest economic challenges of our time,’ Ellison says. ‘Millions of renters are unable to find affordable rental housing. Affordable housing is about more than just rent; it's about ensuring that we maintain the ladder that makes America a land of opportunity.’
Ellison adds that his bill would generate $196 billion over 10 years in revenue, which could be used to expand the Low Income Housing Tax Credit, Section 8 rental assistance and the public housing capital fund. Ellison also proposes using the revenue to finance the National Housing Trust Fund, which was signed into law in 2008 by President George W. Bush but was never funded.
Separately, the National Low Income Housing Coalition (NLIHC) has launched a campaign to reshape U.S. tax policy to make affordable housing more available to the nation's 10.1 million extreme low-income renter households.Â
According to the NLIHC, the centerpiece of the campaign is a proposal to limit the mortgage interest deduction to the first $500,000 of mortgage debt and convert it to a 15% non-refundable tax credit. The coalition claims that the proposed change would generate approximately $200 billion in savings in the first 10 years, which the NLIHC proposes being invested into the National Housing Trust Fund.
‘An overwhelming majority of Americans want to change the way we address the epidemic of unaffordable housing for the nation's poorest people,’ says NLIHC President and CEO Sheila Crowley. ‘The time for solutions is now. It is time for policymakers to scrap unfair and inefficient tax subsidies for high-income Americans and instead make affordable housing available for those who need it most.’