The influence of a mortgage interest deduction on house prices: evidence across tax systems in Europe

Onderzoeksoutput: Articlepeer review

2 Citaten (Scopus)
73 Downloads (Pure)

Samenvatting

In a large majority of European countries, a tax relief on mortgage interest payments is granted in order to enhance homeownership. Although there is a common belief stating that a mortgage interest deduction (MID) is capitalized into house prices, empirical evidence remains scarce. Therefore, our paper is about the influence of this fiscal relief on house prices. The scope of our analysis includes fourteen European countries, for which an unbalanced panel dataset over the period 1990–2015 is constructed. All our regression results support the hypothesis that a MID has had a significant price-increasing effect in the selected countries over the observed period. However, this result does not hold for a MID in the countries where a dual income tax (DIT) is applied, suggesting a significant difference between tax systems. These results are relevant for governments because there has been much debate about whether and to what extent countries should limit its MID over the last decades.

Originele taal-2English
Pagina's (van-tot)245-260
Aantal pagina's16
TijdschriftThe European Journal of Finance
Volume28
Nummer van het tijdschrift3
DOI's
StatusPublished - jul 2022

Bibliografische nota

Publisher Copyright:
© 2021 Informa UK Limited, trading as Taylor & Francis Group.

Copyright:
Copyright 2022 Elsevier B.V., All rights reserved.

Vingerafdruk

Duik in de onderzoeksthema's van 'The influence of a mortgage interest deduction on house prices: evidence across tax systems in Europe'. Samen vormen ze een unieke vingerafdruk.

Citeer dit