The math in this post is confusing as fuck. How about a link to the report?

Heidi, are you still taking questions for an upcoming story about renting in Seattle? How long will that window remain open?

I found the report.

It's vague in its methodology, but I'm guessing that property taxes and homeowners insurance are not factored into Zillow's mortgage payment numbers. Even with rapidly rising housing prices, mortgages might seem lower now relative to 15 or 30 years ago because interest rates are low. But add rising tax and insurance rates into mortgage payments (things that are pre-factored into rents) and I think you'll find that homeowners are not getting off any better than renters.

I'm not sure what income Zillow is using, but if it's AGI, I paid 34% of my income last year on house payments. And spent $1500 on a new water heater when the old one died.

End the mortgage interest tax deduction. It's a subsidy to sprawl and to the upper classes - where's the renter's subsidy?

Also, end zoning. Seattle isn't alone in SF homeowners keeping there "I have mine" suburban style zoning and driving up rents, but we're a particularly egregious case at the moment with skyrocketing demand.

There's more to the cost of owning a home than the mortgage. A lot of the houses that are priced lower are older and require a lot of maintenance - roofs, sewer pipes, furnaces, the list goes on. Plus the utilities. Just a reminder that it's not all easy living for middle and lower income homeowners either. But yes, the rent situation in this town is of great concern.

Well, yeah. That is one of the positives of owning your property. While housing prices continually rise with the market, your rate is locked in because you signed a contract. It comes with risks as well, that one does not take when renting.

@4: Read 6. That makes the mortgage interest deduction quite fair and progressive.

@7: The real problem with the deduction is that it applies to multiple homes, when it should be used solely on a person's first or only home. So the people that get the most back in bulk dollars are people with multiple homes, people who don't really need the deduction.

That being said, it still helps people of all income levels who own homes, and promotes home ownership, which strengthens the national economy, and one's personal economic standing. Renting just moves money from the working class to the ownership class, while giving the working class nothing in return.

Yet look at typical incomes of renters vs. homeowners. It's a massive subsidy to the already comparatively well-off, and serves to widen the wealth gap between renters and owners. Ask any renter if they could benefit from an extra $8500 per year*. Hell, they might be able to buy a house after saving that for a few years.

* $500k mortgage = $2400/month * 12 months x assumed 30% tax rate = $8640 written off your taxes each year

It’s good to own land.

@9 I raised this issue in another thread earlier in the week: you really need to look at a mortgage amortization table.

The figures you've put forth only make sense in the context of an interest-only loan, which is pretty unusual these days. To be clear, the mortgage interest deduction is just that: a deduction for interest. You are apparently deducting the amounts paid toward the principal as well, which makes no sense.

For a traditional 30 year fixed-rate mortgage, the scenario you've proposed would likely result in roughly $6100 in tax savings the first year, $6000 the second year, $5875 the third, and so on.

@8: If by "multiple homes" you mean "two," then you are correct. You cannot deduct mortgage interest or property taxes on a third, fourth, fifth, etc, home.

@9: In addition to what @11 said, you also need to factor in the difference between itemizing and taking the standard deduction (which I imagine most renters take) into your equation. And a 30% tax bracket (which doesn't exist, and since tax brackets are marginal not all income is taxed equally) assumes an individual income of well over $100,000 (married would be twice that), which is well above the median. Your scenario exists, but is not the norm.

And that's what I get for making up numbers. How about we go with referencing numbers from real articles: "in 2015, the federal government spent $71 billion on the MID, and households earning more than $100,000 receive almost 90 percent of the benefits."

The MID is a subsidy for the rich. Full stop. Stop calling it progressive.

https://www.theatlantic.com/business/arc…

@14: I don't know anyone who thinks the MID is "progressive", but it does encourage middle-income home ownership. Personally I would benefit (slightly) from a doubling of the standard deduction and a $500k cap on (or an elimination of) the MID. However, when more people stop itemizing their deductions, I bet you'll see a reduction in charitable giving.

In 1977, my rent for a new-ish one bedroom apt on Harvard near Roy was exactly one-seventh of my monthly gross salary. And my situation was typical for the day.

Here's a handy "Is It Better to Rent or Buy? calculator" the NYT put out several years ago.
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It's cosmically hilarious that the coastal cities are experiencing the skyrocketing house prices... especially since they will be underwater or threatened by the end of the century. What fool will buy them after you when it becomes actually obvious the seas are rising?

On the other hand, coastal cities have always been places of cultural mixing, trade, and tolerance. So, hopefully, perhaps people are drawn here for that aspect. I certainly was.
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@10 - Ah yes, to "own" Land...

Land n. A part of the earth’s surface, considered as property. The theory that land is property subject to private ownership and control is the foundation of modern society, and is eminently worthy of the superstructure. Carried to its logical conclusion, it means that some have the right to prevent others from living; for the right to own implies the right exclusively to occupy; and in fact laws of trespass are enacted wherever property in land is recognized. It follows that if the whole area of terra firma is owned by A, B and C, there will be no place for D, E, F and G to be born, or, born as trespassers, to exist.

I would second those who say that the "rent" that a homeowner is listed as paying likely doesn't include homeowner's insurance or property tax, together which for me cost $4500 a year, let alone costs to maintain a property such as a new roof (which for me will be $10k minimum, when I get this done next year)), siding or paint ($3k), upkeep or replacement of one's furnace (which I had to do 2 yrs ago at the cost of $4k), gutters, the cost of any plumbing issues, and in snowy areas, the incredible cost to repeatedly having to shovel one's roof ($200 a pop) to keep ice dams at bay (which I had 2 yrs ago, which caused water to flow into the house).

This is to say nothing of the fact that so many rental situations involve free heat, at least here in the northeast, whereas homeowners have to pay that entirely themselves, of course. Then there's the work of maintaining one's lawn, shoveling/snow blowing/salting all winter, dealing with any electrical issues that might occur, etc etc.

I wish the Stranger would consider that people who own homes often worked very hard to obtain them, and work even harder and pay thru the nose to maintain them. We aren't the bad guys here.

15 years since buying condo: mortgage payment plus homeowners dues plus line of credit loan payment to cover the cost of the $24,000 special assessment. Plus homeowners insurance and property taxes. Easily eats half my salary. Plus, if anything happens to any of my appliances or windows or whatever, I have to pay for that. Tell me again how tough it is to be a renter ...

This is a silly study. Many homeowners bought decades ago. Many have long since paid off their mortgage. Interest rates have come down significantly over the past 10 years. I doubt people who bought in the past year or two are paying less of their income than renters, especially if you adjust for age.

Not to worry. The new Stranger-proclaimed matriarchy of Seattle will fix everything because if they don’t it’s gonna get “Jersey Shore” ugly.

Matt the Engineer and mistral won’t be content until everyone is caught in the ever tightening grip of #RentSlavery.