I wasn't aware that the tax breaks on mortgage interest were so straightforward in the U.S. Here in Canada nothing similar exists.

There seems to be an interesting natural experiment here -- in Canada, even though there is no such deduction, people's attitudes and behavior with regards to renting vs. buying are still more or less the same as in the U.S. (In fact, the recent crash has probably left Americans less eager to buy on average.) So while the tax break changes the math in favor of buying significantly for people in high tax brackets, it looks like this isn't the crucial factor motivating people to buy in practice.