Haha it sure as shit does not. Landlord's keep it. The reasoning that shareholder/landlord savings either via by tax or fiat are shared with tenants or customers is a hilariously wrong fallacy of trickle-down economic thinking that has been debunked.
The landlord charges what they believe they can charge.
That's set by market rates in your local area (or cartels like RealPage [0] et al.).
And that's set to homogenize returns with national rental alternatives.
And that's set by alternative options to invest of capital.
If you +5% to the costs of operating rental property, by removing a deduction, rents are going to go up.
And focusing on commercial mortgage interest deductions is ridiculous, as they're accounted for in the exact same way as every other business: expenses deducted from income.
I’m hypothesizing that removing favorable tax incentives for owners will cool real estate speculation and cause demand for homes to fall such that prices fall such that more renters become owners. There’s an eventual equilibrium sure but it’s probably at prices less than they are now.
I’ll concede to you on the costs flowing to renters in the sense that if ownership costs go up for all owners rents would follow.
I still think as a category the asset is far too tax advantaged at the expense of the poor or the non-home owning to the detriment of society as a whole.
I'm with you in that I fundamentally believe everyone who desires it should have access to home autonomy. In the sense they are the sole arbiter of actions involving their primary residence, including stable, predictable financing costs.
To me, the biggest problem is the lack of affordable capacity available for primary residence buyers at desired price points.
Which means increasing inventory.
Which means (1) upzoning for density (as most desired locations are land-constrained) & (2) preventing that new inventory from being constructed-as or repurposed-into rentals.
To (2), I'd love to see more efforts to increase costs on large landlords. E.g. a limited-number token system, effectively capping the % of rental properties in an area, with tokens regularly (re-)auctioned off to the highest bidder.
If a giant corporation wants to be a landlord, they shouldn't be able to corner the market.
