The housing industry has staunchly defended the mortgage interest tax deduction as an essential tool for promoting homeownership. But attitudes are softening, as data show the low- and moderate-income homebuyers who need the subsidy the most are getting the least benefit.

If the deduction were to be discontinued, it would make housing a little less affordable than it is right now. But with interest rates remaining near all-time lows, it would have less of an effect on borrowers' wallets than it in the 1980s, when rates were above 10%.

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