WASHINGTON -- That most sacred of tax breaks, the mortgage interest deduction that has helped millions buy homes, could vanish if President Bush and Congress follow the recommendations of his tax advisory board.

Nine tax experts, tasked with developing simpler and fairer tax laws, concluded that the deduction does more for wealthier taxpayers than for people struggling to buy a home. Mortgage bankers and real estate agents see irreparable harm, though, if the tax break disappears.

The National Association of Realtors estimated housing prices could decline 15 percent, bad news for owners who have seen their homes' values increase. "You're going to be taking away from Middle America," said David Lereah, the association's chief economist.

"Everyone, whether you use the mortgage interest deduction or not, the value goes down," he said. "You've just reduced the retirement nest egg for everyone."

The current tax break lets homeowners deduct interest paid during the year on a mortgage up to $1 million and a home equity loan worth up to $100,000. Homeowners also benefit from breaks that let taxpayers deduct state and local property taxes from the federal bill.

The President's Advisory Panel on Federal Tax Reform urged the administration to do away with the deduction and replace it with a credit worth 15 percent of interest paid during the year. They would scrap the deduction for property taxes, too.

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