OPINION (GREENLINING INSTITUTE) – Before the pandemic, California battled the highest levels of poverty, income inequality, and the largest unhoused population in the country. The state also placed the second-lowest in homeownership per capita. Now due to COVID-19, California can expect long-term budget deficits for the next few years. Yet despite all this, the state continues to subsidize wealthy homeowners through the mortgage interest deduction. By eliminating the mortgage interest deduction on vacation homes and reforming the mortgage interest deduction on primary homes to match federal law, we would free up about $500 million in California’s annual budget. It’s time to peel away a layer of one of the real estate industry’s most sacrosanct programs: the mortgage interest deduction.