GOP tax plan - effect on housing market and economy of Blue states

[techynt]

From what I have heard, bigly changes has been planned for deductions like mortgage interest, local taxes, property taxes etc..

I was wondering if this will be a big deal for housing market in Bay area?
IMO, this maybe a nothing burger, an extra 10k/year in taxes is not going to affect people earning > 200k, whats your take on this?

http://www.latimes.com/business/hiltzik/la-fi-hiltzik-tax-california-20171103-story.html

[Dicky_Bird]

If it happens that new tax rules does not allow to take mortgage interest and property taxes deductions it will not impact any Desi families because while purchasing it was only school ratings that attracted them to house not what kind of deduction they are getting.
initally it may effect some buyers as news builds up some short term panic for desi and other buyers.
bay area no impact prices going higher no doubt, families making $400k and living in million dollar houses care less

[realgoogler]

Even with all the deduction renting was cheaper than buying. Now It would make more sense to rent than buy for the middle class.
So rentals demand will go up and hence the price and hence providing fundamental support the current crazy price levels :)

[Desi]

I believe the property tax deduction is allowed but only upto 10K.

And I think even mortgage deduction is allowed on upto loans of 500K

[techynt]

But for a family of 4, the new standard deduction will be higher than these deductions, right?


Also, most homes in Bay area are priced higher than 1.5 million, property taxes are around $17-20k and I am guessing mortgage maybe more than a million for most of these.

Example:
https://www.realtor.com/realestateandhomes-detail/1003-Mango-Ave_Sunnyvale_CA_94087_M23532-33927

I believe the property tax deduction is allowed but only upto 10K.

And I think even mortgage deduction is allowed on upto loans of 500K

[techynt]

Thats what I was thinking.

Some one with 400k income maybe in 35% tax bracket.

If their deduction goes down by $20-30k, they are losing only 35% of 20k, which is around $7k. But if they have kids, the new higher standard deduction along with higher child tax credit may offset these.

Are my calculation, roughly in the ball park, or I am not understanding it correctly?

If it happens that new tax rules does not allow to take mortgage interest and property taxes deductions it will not impact any Desi families because while purchasing it was only school ratings that attracted them to house not what kind of deduction they are getting.
initally it may effect some buyers as news builds up some short term panic for desi and other buyers.
bay area no impact prices going higher no doubt, families making $400k and living in million dollar houses care less

[tlv]

Higher standard deduction is not even compensating for the loss of exemptions (roughly 16K for a family of 4).

[somberi]

that family of 4 will lose personal exemptions to the tune of $16000 (using current figures of $4000 per person) - hence they will pay more in taxes even after doubling standard deduction.

But for a family of 4, the new standard deduction will be higher than these deductions, right?


Also, most homes in Bay area are priced higher than 1.5 million, property taxes are around $17-20k and I am guessing mortgage maybe more than a million for most of these.

Example:
https://www.realtor.com/realestateandhomes-detail/1003-Mango-Ave_Sunnyvale_CA_94087_M23532-33927

[realgoogler]

I think it might not be that bad at all for household income >250K.... Since they might be already be paying this extra for AMT previously.

[Desi]

So Trump will save tens of millions every year in AMT and shield billions from estate taxes.