Accession Number PB2013-102205
Title Taxation of Owner-Occupied and Rental Housing.
Publication Date Nov 2012
Media Count 51p
Personal Author L. Ozanne
Abstract This paper illustrates how the different tax treatments of owner-occupied and rented houses affect the relative costs of owning and renting. In the examples, a representative landlord computes the rental rate (the ratio of the rent to the value of the house) required to break even on an investment in a house. Potential homeowners compare that market rental rate as a tenant with an implicit rental rate that reflects the cost of owning a home. The tax advantages tend to make owning more advantageous than renting for higher-income households, but lower-income households can find renting cheaper than owning. The paper also illustrates how limiting or eliminating certain tax advantages would change the cost of owning relative to renting. While the precise comparisons are specific to the conditions detailed in the examples, their general implications are broadly applicable.
Keywords Costs
Homeowners
Housing
Landlords
Low-income households
Market rates
Rental housing
Taxation
Taxes
Tenants


 
Source Agency Congressional Budget Office
NTIS Subject Category 91E - Housing
96A - Domestic Commerce, Marketing, & Economics
70F - Public Administration & Government
Corporate Author Congressional Budget Office, Washington, DC.
Document Type Technical report
Title Note Working paper.
NTIS Issue Number 1306
Contract Number N/A

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