Federal Housing Subsidies Disproportionately Benefited Upper Income Homeowners

A research brief released in December by the Urban Institute finds that more than three-quarters of the $199.5 billion in 2006 federal housing subsidies targeted homeowners, while less than one-quarter benefited renters.

Tax breaks, primarily in the form of the mortgage interest deduction, constituted nearly all of the $157.5 billion in subsidies going to homeowners, while 87% of the $42.0 billion in renter subsidies took the form of direct outlays.

Because tax subsidies typically favor affluent households, this distribution of federal funds resulted in the wealthiest 20% of American households receiving 81.5% of all federal housing subsidies in 2006.

The brief, which is based on data from the federal budget, is available at www.urban.org/UploadedPDF/411592_housing_subsidies.pdf or by downloading from our website.