[USNBandit]

The version of the Fair Tax I read included the tax on home purchases, but only if they were for a residence. The tax did not apply to investment property. The short term effect would be a collapse of housing equity for sellers with a huge price increase for buyers.

[gitmo]

The version of the Fair Tax I read included the tax on home purchases, but only if they were for a residence. The tax did not apply to investment property. The short term effect would be a collapse of housing equity for sellers with a huge price increase for buyers.

I'm pretty weak in Economics, but it strikes me this would be true for lower priced houses and not for higher priced homes. The former are being purchased by people not paying Income Taxes today. The latter are being purchased by people already paying high income taxes and they will have a net tax reduction.