I would love to see a map showing what states the people who take the income tax deduction for home mortgage interest live. I think we'd find it was the so-called Blue states, where the value of land is higher, and wages are higher, and property taxes are higher.
Funny that we're willing to help subsidize the borrowing necessary for some people (buyers) to paying off other people (sellers) for value the sellers didn't create! And then we don't tax those so-called "capital" gains much at all! A few communities collect a few percent of each transaction, which isn't a great idea either, particularly when it is collected from the buyers, who likely borrow it!
Who gains? the FIRE sector. What else is new?
How naive are we? Don't ask!