'Feeling the Pinch': Tax Bills May Go Up $3,000 in These Coastal Markets

January 12, 2018
House exterior
Photo: Pixabay

Citigroup real estate analyst Will Randow says that homeowners in high-tax states like New York, Connecticut, and California may see their tax bill increase by an average of $3,000 per household as a result of the new Republican tax law.

Randow added that a change to the state and local tax (SALT) provision in the tax law is the main driver causing this increase for taxpayers, CNBC reports. Previously, there was no limit on SALT deductions, now, the deduction is capped at $10,000. The National Association of Realtors is forecasting home prices to be down 10 percent for California, Randow pointed out.

But on the other side, Evercore ISI analyst Stephen Kim told CNBC last week, "This is sort of a backdoor way of removing a subsidy for housing that we've seen in this country for almost a century." Many experts blame that "subsidy" and the lax mortgage lending standards of the past as factors that fueled the housing price bubble that peaked in 2006 and then burst.

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