A Common-Sense Way to Prevent Child Homelessness and Promote Home Ownership

A public hearing on HB 3349, the Homeownership and Housing Opportunity Bill, – Testimony begins on video link at 1:04:48 –  was held Monday, March 11 before the House Committee on Human Services and Housing chaired by Representative Alissa Keny-Guyer. (photo to right)

The bill would shift $150 million currently spent subsidizing Oregon’s richest homeowners to investments in affordable homeownership and homeless services. This bill was developed by a broad coalition led by Housing Oregon and Oregon Center for Public Policy (OCPP).

“There is a common misconception in our society today that community members with the least means receive the greatest percentage of government support for essentials like housing,” said Shannon Villhauer, Executive Director of Habitat for Humanity of Oregon. “In fact, the highest income earners in the United States receive the most housing subsidy.”

HB 3349 scales back the state mortgage interest deduction starting at $200,000 in adjusted gross income, and completely end the state subsidy at $250,000. This protects the deduction for 95 percent of taxpayers – only targeting the richest 5 percent who do not need the state to subsidy their homes.

“The current mortgage interest deduction is inequitable, putting at a disadvantage low – and moderate -income Oregonians, Oregonians of color, and rural Oregonians,” said Daniel Hauser, Policy Analyst with OCPP. “The benefits accrue to higher income taxpayers because this is an itemized tax deduction – so folks who use the standard deduction do not benefit – and renters inherently receive no benefit.”

According to Oregon Housing and Community Services’ newly released Statewide Housing Plan, African Americans experience a homeownership rate of 32% compared to a rate of 61% for all Oregonians. For Hispanics the rate of homeownership is 39%.

“So, what are we doing?” asked Tim Pitts, owner and Principal Broker with THINK Realty. “Right now, we’re giving hundreds of millions of dollars a year for a subsidy to the rich. The mortgage interest deduction subsidizes rich people, provides zero relief for rent burdened people, zero relief for homeless people and less help for people of color than white people.”Check out Pitts’ recorded testimony beginning at 1:29:12.

Rural Oregonians are also disproportionately impacted by the housing crisis compared to other rural areas across the U.S. According to the Statewide Housing Plan. In Oregon they are higher than in the rest of the rural U.S. Compounding the problem, median family incomes in rural Oregon are $42,750 compared to $54,420 in urban counties.

The Housing Alliance workgroups on Homelessness and Homeownership have provided investment recommendations for amendments to the bill including investing in long term rental assistance vouchers and services for permanent supportive housing. Another idea is the creation of a revolving loan fund to build new affordable homeownership options.

For more info and to get involved, contact Brian Hoop, Director, Housing Oregon,brian@housingoregon.org or 503-475-6056.