My Testimony on the Oregon Proposed MID Reform Bill (SB 976): AFTER REFORM, Homeowner With $225K Income Still Nets $110, 000 in Benefits Over 5 Years.

The Oregon Senate Finance and Revenue Committee has a scheduled April 12th public hearing on SB 976, This bill would impose an income cap that phases out state deduction of mortgage interest at $250,000 and phases in reductions to the deduction beginning at $200,000 of income.  

I constructed an example to show how much benefit would remain for a homeowner with a $720,000 mortgage (below the conforming limit of $726,200) at 6% interest and an income of $225,000.

My testimony in the PDF file HERE and embedded below includes a summary of results and graphs on pages 2 and 3 that provide more detail. 

SHORT VERSION: 

• WITH NO home value appreciation, the $225K income homebuyer retains $110,513 in benefits over the first 5 years, an average of $1,884  a month.  
• $60,505 of those benefits are MID subsidy with the remaining $50,008 in benefits from equity/wealth accumulation resulting from the reduction in mortgage principal.  
• Over the same period, Oregon RENTERS are entitled to ZERO subsidy and ZERO  equity/wealth accumulation. 

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