.embed-container { position: relative; padding-bottom: 56.25%; height: 0; overflow: hidden; max-width: 100%; height: auto; } .embed-container iframe, .embed-container object, .embed-container embed { position: absolute; top: 0; left: 0; width: 100%; height: 100%; } I’m sure you’ve heard a lot about tax reform lately. Here’s a few ways The Tax Cuts and Jobs Act will affect the real estate market. Buying a home? Click here to perform a full home search Selling a home? Click here for a FREE Home Price Evaluation There's a lot of uncertainty about The Tax Cuts and Jobs Act and its effect on real estate. Let’s first take a look at the four key tax changes impacting the housing market at this moment: 1. Deductions for property taxes. Prior to the new tax bill, if you itemized your deductions, you could deduct all of your property tax. Going forward, this amount will be capped at $10,000. 2. Deductions for mortgage interest. The final bill reduces the limit on deductible mortgage debt to $750,000 for new loans taken out after 12/14/2017. Other loans of up to $1 million are grandfathered in. 3. Home sales exclusion for capital gains. If you sell your home and turn a profit, then up to $500,000 of that profit is exempt from capital gains tax. Although earlier versions of the bill required you to live in the home for five out of the last eight years, the final bill made no changes to the capital gains exclusion. In order to qualify for this exclusion, you must have lived in your home for two of the past five years to claim this exemption—just like before.  4. Deductions for moving expenses. The final bill repealed the moving expense deduction, except for those who are members of the Armed Forces.  The first two changes increase taxes on current homeowners and make homeownership less attractive. This is a part of why the National Association of Realtors claims that home prices could drop by more than 10% due to the new tax plan. On the other hand, the last change makes it more expensive to sell your home. As a consequence, they could keep some homes off the market. These reforms may drive home prices down in the midterm. We'll have to see how the different changes play out in reality, and how they interact with other real estate conditions. However, there does seem to be a consensus among experts that current reforms might drive home prices down somewhat in the midterm. On the bright side, home sellers do still get to take advantage of the home sales exclusion for capital gains. That is a major victory for real estate. That's why if you've been thinking of selling your home, now might be a good moment to start the process. If you have any questions, whether you are buying or selling, you can always call me or shoot me an email. I can give you more specific recommendations based on your unique situation. I look forward to hearing from you soon.

Deja Lett Team Real Estate Podcast

[email protected] (Deja Lett)

Tax Reform’s Effect on the Real Estate Market

JAN 23, 2018-1 MIN
Deja Lett Team Real Estate Podcast

Tax Reform’s Effect on the Real Estate Market

JAN 23, 2018-1 MIN

Description

<div style="text-align: center;"> <div style="text-align: left;"> <style> .embed-container { position: relative; padding-bottom: 56.25%; height: 0; overflow: hidden; max-width: 100%; height: auto; } .embed-container iframe, .embed-container object, .embed-container embed { position: absolute; top: 0; left: 0; width: 100%; height: 100%; } </style> <br /> <div class="embed-container"> <div style="text-align: center;"> <!--insert embed code here--> <iframe allow="autoplay; encrypted-media" allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/UCzLyr-hHS0?rel=0" width="560"></iframe> <!--end--> </div> </div> <div style="text-align: center;"> <i style="background-color: white; font-family: Arial, Helvetica, sans-serif; font-size: 15.4px; line-height: 21.56px;"><span lang="EN" style="font-family: &quot;arial&quot; , sans-serif; font-size: 11.0pt; line-height: 115%;"><br /></span></i> <i style="background-color: white; font-family: Arial, Helvetica, sans-serif; font-size: 15.4px; line-height: 21.56px;"><span lang="EN" style="font-family: &quot;arial&quot; , sans-serif; font-size: 11.0pt; line-height: 115%;">I’m sure you’ve heard a lot about tax reform lately. Here’s a few ways The Tax Cuts and Jobs Act will affect the real estate market.</span></i><br /> <i style="background-color: white; font-family: Arial, Helvetica, sans-serif; font-size: 15.4px; line-height: 21.56px;"><br /></i> <i style="background-color: white; font-family: Arial, Helvetica, sans-serif; font-size: 15.4px; line-height: 21.56px;">Buying a home?&nbsp;<b><a href="http://www.mainehomeadvisors.com/">Click here to perform a full home search</a></b></i></div> <div class="MsoNormal"> <span lang="EN"></span></div> <div class="MsoNormal"> <span lang="EN"></span></div> <div style="text-align: center;"> <i style="background-color: white; font-family: Arial, Helvetica, sans-serif; font-size: 15.4px; line-height: 21.56px;">Selling a home?&nbsp;<b><a href="http://www.dejalett.smarthomeprice.com/" target="_blank">Click here for a FREE Home Price Evaluation</a></b></i></div> <div class="MsoNormal"> <span lang="EN"><span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><br /></span></span></div> <div class="MsoNormal"> <span lang="EN"><span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;">There's a lot of uncertainty about The Tax Cuts and Jobs Act and its effect on real estate. Let’s first take a look at the four key tax changes impacting the housing market at this moment:</span></span></div> <div class="MsoNormal"> <span lang="EN"><span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><br /></span></span></div> <div class="MsoNormal"> <span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><b><span lang="EN">1. Deductions for property taxes. </span></b><span lang="EN">Prior to the new tax bill, if you itemized your deductions, you could deduct all of your property tax. Going forward, this amount will be capped at $10,000.</span></span></div> <div class="MsoNormal"> <br /></div> <div class="MsoNormal"> <span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><b><span lang="EN">2. Deductions for mortgage interest. </span></b><span lang="EN">The final bill reduces the limit on deductible mortgage debt to $750,000 for new loans taken out after 12/14/2017. Other loans of up to $1 million are grandfathered in.</span></span></div> <div class="MsoNormal"> <br /></div> <div class="MsoNormal"> <span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><b><span lang="EN">3. Home sales exclusion for capital gains. </span></b><span lang="EN">If you sell your home and turn a profit, then up to $500,000 of that profit is exempt from capital gains tax. Although earlier versions of the bill required you to live in the home for five out of the last eight years, the final bill made no changes to the capital gains exclusion. In order to qualify for this exclusion, you must have lived in your home for two of the past five years to claim this exemption—just like before.&nbsp;</span></span></div> <div class="MsoNormal"> <br /></div> <div class="MsoNormal"> <span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><b><span lang="EN">4. Deductions for moving expenses.</span></b><span lang="EN"> The final bill repealed the moving expense deduction, except for those who are members of the Armed Forces.&nbsp;</span></span></div> <div class="MsoNormal"> <br /></div> <div class="MsoNormal"> <span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><b><span lang="EN">The first two changes increase taxes on current homeowners</span></b><span lang="EN"> <b>and make homeownership less attractive. </b>This is a part of why the National Association of Realtors claims that home prices could drop by more than 10% due to the new tax plan.</span></span></div> <div class="MsoNormal"> <br /></div> <div class="MsoNormal"> <span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;"><b><span lang="EN">On the other hand, the last change makes it more expensive to sell your home. </span></b><span lang="EN">As a consequence, they could keep some homes off the market.</span></span></div> <br /> <br /> <div class="quote-box"> <div class="quote-text"> These reforms may drive home prices down in the midterm. </div> </div> <br /> <br /> <div class="MsoNormal"> <span lang="EN"><span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;">We'll have to see how the different changes play out in reality, and how they interact with other real estate conditions. However, there does seem to be a consensus among experts that <b>current reforms might drive home prices down somewhat in the midterm.</b></span></span></div> <div class="MsoNormal"> <br /></div> <div class="MsoNormal"> <span lang="EN"><span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;">On the bright side, home sellers do still get to take advantage of the home sales exclusion for capital gains. That is a major victory for real estate.</span></span></div> <div class="MsoNormal"> <br /></div> <span lang="EN" style="line-height: 115%;"><span style="font-family: &quot;arial&quot; , &quot;helvetica&quot; , sans-serif;">That's why <b>if you've been thinking of selling your home, now might be a good moment to start the process</b>. If you have any questions, whether you are buying or selling, you can always call me or shoot me an email. I can give you more specific recommendations based on your unique situation. I look forward to hearing from you soon.</span></span></div> </div>