Survey: Mortgage interest deduction wins out over lower tax rates

When asked about whether they would support lowering tax rates while eliminating or reducing the home mortgage interest deduction, the charitable giving deduction and the local income tax deduction, 56 percent opposed the move. 

Results were similar by party with 57 percent of Democrats, 54 percent of Republicans and 56 percent of independents showing little appetite to touch the popular mortgage interest deduction. 

All told, 73 percent of voters oppose eliminating the mortgage interest tax break and the figures, once again, held firm across the political lines, with 77 percent of Republicans, 71 percent of Democrats and 71 percent of independents against doing away with tax break.

There has been some chatter in Congress that the deduction would be eliminated if a major tax reform package moves through the House and Senate. But with the legislative calendar shortened in an election year, there isn't likely much chance of an overhaul going through.

The mortgage interest deduction is "squarely in cross-hairs of deficit-cutters," said Jim Tobin, NAHB's chief lobbyist on Wednesday. 

But talk about a tax reform effort has largely turned into a "political football," he said. 

Voters said in the survey that they probably wouldn't vote for a lawmaker who wants to eliminate the tax break — with 68 percent saying they would be less likely to support a candidate who backs changes, with similar number across the parties. 

A majority of voters said they also oppose proposals to reduce the mortgage interest deduction, eliminate the deduction for interest paid for a second home, limit the deduction for those earning more than $250,000 per year, scale back the deduction for home owners with mortgages above $500,000 and do away with the deduction for interest paid on home equity loans.

"With the 2012 election season in full swing, candidates running for the White House and Congress would be wise to heed the will of the American voters, who have expressed broad support for government policies that encourage homeownership and oppose efforts to make it more difficult to get a home loan and to tamper with the mortgage interest deduction," said Celinda Lake, president of Lake Research Partners, one of the polling firms. 

Overall, voters oppose diminishing the federal role in helping qualified home buyers obtain affordable 30-year mortgages, according to the poll. 

The poll shows that three out of four voters — owners and renters — believe it is appropriate and reasonable for the federal government to provide tax incentives to promote homeownership. This sentiment cuts across party lines, with 84 percent of Democrats, 71 percent of Republicans and 71 percent of independents agreeing with this statement.

Also, two-thirds of respondents say that the federal government should help home buyers to afford a long-term or 30-year, fixed-rate mortgage.

The results come at a time when congressional Republicans are pressing for the federal government to extract itself from the mortgage financing industry — specifically, unwinding mortgage giants Fannie Mae and Freddie Mac while promoting more private sector involvement. 

"The American electorate is sending a clear message that owning a home remains a cornerstone of the Americandream and preserving a federal commitment to homeownership is essential to maintain a thriving middle class and get housing and the economy back on track," said Neil Newhouse, a partner and co-founder of Public Opinion Strategies. 

The survey was conducted Jan. 2-5 by the Republican and Democratic polling firms of Public Opinion Strategies in Alexandria, Va., and Lake Research Partners in Washington, D.C. The poll includes responses from 1,500 likely voters.