dingell’s mcmansion proposal draws more fire

It’s taken a few weeks, but Dingell’s proposal about cutting off the mortgage-interest tax deduction for homes of more than 3,000 square feet, is starting to make headlines outside of Michigan. In the past few days, there were articles in both “Forbes” and the “Washington Post.” Here’s a clip from the former.

…According to the federal government’s American Housing Survey in 2003, the latest available, more than 8.6 million homes are 3,000 square feet or more in size nationwide. That number likely increased in the final two years of the real estate boom that ended in 2005.

The real estate industry has long opposed limiting a tax break that many homeowners, especially those looking to shelter higher income levels cherish.

The housing market’s downturn makes this an especially bad time to alter the interest deduction, industry officials say.

Changes to the interest-deduction tax break “would have repercussions for the housing market as a whole,” said Mary Trupo, a spokeswoman for the Washington-based National Association of Realtors trade group…

Consumer behavior, such as buying energy-efficient light bulbs and appliances, is more important than a house’s size, Bill Killmer, executive vice president for advocacy at the National Association of Home Builders, said Friday in an e-mailed statement. “Home size is not a good indicator of the amount of energy a household would use,” Killmer said….

Dingell, a longtime supporter of Detroit’s auto industry, insisted that the proposals are not an attempt to publicize the economic costs of fighting the impact of climate change.

“To those who have suggested this may be an attempt to sabotage climate change legislation: you are wrong,” said Dingell, a House member since 1955. “I’ve spent more than half a century in Congress, and I have never introduced legislation with the intention of seeing it fail.”

So, did you get the Republican talking points? The first one is that this is bad for the housing industry, which is already suffering. The second is that large homes are often more efficient than smaller homes. We’ll be hearing these over and over again these next few months, so prepare yourself. I personally don’t think that either holds a lot of water. I don’t think that this legislation, if it passed, would hurt the real estate market any more than it’s already hurting, and I doubt very seriously that a 3,000+ square foot home – regardless of what kind of light bulbs its owner buys – uses less energy than the average American home, which is probably about 1,000 square feet. I’m sure that you could find a 3,100 square foot home that consumes less energy than a 2,900 square foot home, but that wouldn’t prove much anything. Maybe Dingell just tossed this out to take the heat off the auto companies for a while, but I think it’s a damned good idea. Sure, 3,000 square feet is kind of arbitrary, but Americans need to start feeling the real costs of global warming, and they need to change their behavior accordingly. We can debate the number, but we have to draw a line somewhere. McMansions, like Hummers, are a bad thing for society and they need to be phased out.

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13 Comments

  1. Citizen Blogger
    Posted August 27, 2007 at 12:13 pm | Permalink

    especially those looking to shelter higher income levels

    ‘nuf said.

  2. egpenet
    Posted August 27, 2007 at 1:37 pm | Permalink

    There are many better ways to “shelter” high incomes … the best is to invest capital in the local economy … buy a building, start a small business, fund a small business … maybe make MORE money!

    The 3000 square foot house, IMO, is a symbol of the sprawl lifestyle. It’s not just the house … which by the way is so airtight the way they build them that pollutants CANNOT escape but make you sick(er) … but to live in one requires roads, cars, gasoline, energy for heating and electric, school bus rides, long commutes … blah, blah, blah.

    If someone wants a larger home … come visit me at an HDC meeting … Boy, do I have some bargains … all within walking distance of fabulous downtown Ypsilanti, Depot Town, EMU and Dos Hermanos!

  3. Steph's Dad
    Posted August 27, 2007 at 1:39 pm | Permalink

    I can’t believe there are almost 10 million McMansions here in the U.S.

    Here’s another interesting statistic: A burning McMansion uses NO electricity.

  4. Bonnie
    Posted August 27, 2007 at 6:10 pm | Permalink

    Although the 3ksqft idea is a good one on its face, there are at least some grains of truth in the opposition.
    ->There are older homes over 3ksqft, many of which are definitely not part of sprawl, as egpenet above pointed out- yet these will cost the owner their mortgage deduction. This could have the unintended side effect of discouraging buyers in those neighborhoods.
    -There are homes that are greater than 3ksqft that are more energy efficient than those under it, yet people might be discouraged from buying them.
    -About the older homes: if they’re older, full of character, and greater than 3ksqft, but aren’t selling, chances are (unless historic regulations interfere) that they’ll be bulldozed for smaller residences. In and of itself, that’s not bad- unless it happens on a larger scale, and we start losing a lot of the character that defines our older neighborhoods- the ones that don’t have historic preservation protections.
    – I’ve yet to see how multi-family units would be addressed by this. Would a 3500sqft house with a 1ksqft mother-in-law accessory dwelling (making the primary residence 2500sqft) be subject to the new law?

    It’s an idea with good intentions, but (as much as I hate to admit it), that Killmer quote is right- home size is not a good indicator of energy usage. Why not tax “excess” energy usage instead, scalable by building/housing size/type? That’d provide more direct incentive to reduce use, or to produce-your-own. It’d probably also be more customizable by state/climate- that way, say, West Virginia would have different standards than, say, New Mexico or Alaska.

  5. egpenet
    Posted August 27, 2007 at 9:10 pm | Permalink

    My home is 2195, not including the basement,
    which is not suitable for living space.

    If the basement were finished and made into habitable space, the total would jump to 3195 … and the % of my mortgage deduction represented by the 195 extra square footage (.06) would be non-deductible. Small price to pay.

    On the other hand. I have always advocated “pay as you go” taxes. Bonnie’s idea of added taxes on electricity and natural gas is logical. The “answer” is to conserve (or at least stay steady) or you pay more.

    I don’t pay a national share on utilities (natural gas, electricity, water) now … I pay as I go. I don’t pay a national share of gasoline taxes … I pay as I go.

    This is also why I favor other forms of consumption taxes, including increased sales taxes. Raising the standard deduction to cover families at or under the poverty level would protect them from being gouged … and it would make all of us more careful shoppers.

    As I’ve noted in this blog before … realtors have told me … it’s a “definite plus” to be listing a home in the Historic District. Rentals (duplexes), Bonnie, I do not think are included in Dingell’s plan. And knowing the Democrats, there will be all kinds of hidden “outs” for mother-in- law apartments, etc.

  6. rodneyn
    Posted August 28, 2007 at 11:31 pm | Permalink

    The Honorable senior congressman from the automobile industry is grandstanding to shore up his environmental bonafides using the political language of class. Will there be exemptions for accessory apartments or historic homes? What if you run a home business? Will there be exemptions for certain zipcodes or regions of the country, or if you happen to have 6 children? How ’bout 7 kids, or 8 or 9?

    There is no substance to this proposal. Mr. Dingell knows that, which is why he is so comfortable as he seems to go out on a political limb to espouse it.

  7. egpenet
    Posted August 28, 2007 at 11:55 pm | Permalink

    Ding-a-ling! He has fulfilled Barnum’s great euphamism: You Can Fool Most People All of the Time … he’s even suckered in the UAW (I was shocked how they rolled over for Dingell like a puppy), AFL-CIO (Meany is such an old fart and so ineffective), and almost, but not nearly, the Teamsters … Jimmy taught his people well (trust no one). Too bad, Jimmy had a debt to pay that he could not pay.

  8. Jeff S
    Posted February 20, 2008 at 1:07 pm | Permalink

    This is nothing but big government fascism, with a little Democrat Party class warfare thrown in just for a hoot.

    Dingell’s idea has nothing to do with greenism or limiting growth — if he did mean it to be that he would require green measures in new houses and not raise taxes. It has to do with raising taxes. Who is he raising them on? Middle class people like me who have worked their butts off for decades to buy a house for their families. Who else? People with large families.

    Those of you who may believe the Al Gore fantasies are free to do so — but don’t raise my taxes to pay for it.

    And what’s with the hate, Steph’s Dad? You state: “Here’s another interesting statistic: A burning McMansion uses NO electricity.” You Here’s another interesting statistic: A shot-dead house-burner doesn’t spew bile on the internet.

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    Posted May 23, 2008 at 12:39 pm | Permalink

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  13. b state
    Posted June 14, 2010 at 12:21 pm | Permalink

    Does anyone remember this farce of Dingel’s?

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