Now that the congress has changed colors from red to blue, it's nearly a certainty that one of real estate's bugaboos will become a thing of the past in 2007.  Both the House and the Senate passed a bill which included a Federal deduction for PMI, a considerable monthly sum going to lenders when borrowers have less than 20% of their own funds invested in their purchase.  The real estate community has been pushing for such a deduction for years, but the Republican controlled congress was never a big fan of giving buyers a tax break on their PMI.  The bill is almost certain to be signed by the President, giving home buyers an incentive to wait till January 2007 to close on a home.

Broderick Perkins explains the details in an article in Realty Times.  Check it out for how it will affect you.

Update:  The Rocky Mountain News has an in-depth article this morning about the implications of the new mortgage insurance deduction.

Update 12/23/06:  Another in-depth article about the new law in the Wall Street Journal.