Apparently the Obama administration is rethinking the idea of placing a cap on itemized deductions for mortgage interest.  Thank you.  This seems to be a case of one hand of the policy team not knowing what the other is doing (the administration does seem so busy that you wonder if the policy wonks even have a chance to keep up with what's going on outside their realm of focus). The question of whether or not "wealthy" homeowners should have a cap on their deductions aside, at a time when the government is taking measures to end foreclosures, encourage homebuying and generally trying to stabilize the housing market, putting a chill on the purchasing incentives for any segment of the market seems almost laughably absurd.  Certainly many buyers take into consideration the amount of their mortgage deduction when deciding "how much" house to buy.  Many of the foreclosures are occurring in neighborhoods that appeal to high income buyers, and all indications are that this segment could represent the next wave of foreclosures.  These are areas that need buyers.  The cap also ignores that fact that all segments of the market are co-dependent.  If property values drop or remain suppressed at the high end, that will certainly trickle down through all segments.  This is one idea that needs to be tabled, at least for now. Thankfully the administration is listening. Now, maybe they'll reconsider the wisdom of eliminating professional appraisers from the loan modification program.  More on that next week....  Have a great weekend!