John Burns Real Estate Consulting reports that the 2017 Tax Cuts and Jobs Act will likely benefit the majority of homeowners and renters.
For a typical married couple who files jointly, renters saved an average of $2,716 in taxes in 2018, and homeowners saved an average of $1,508. Rent savings were highest in tight markets like San Jose ($5,214), San Francisco ($5,079), and Washington, D.C. ($4,460). Homeowners saved the most in mid-sized cities like Nasheville ($2,335), Phoenix ($2,260), and Indianapolis ($2,203).
With the vast majority of America receiving a boost in disposable income, we conclude that landlords will be able to charge more in rent, aspiring home buyers will be more likely to save a down payment and afford a more expensive mortgage, and certain markets (especially in the South) will benefit far more than others. Below are some key findings from our analysis.
Renters who have been saving to purchase have gotten some help with their endeavor, and we will see more of them purchase homes in 2019 and beyond. Entry-level homes will continue to outperform. Low unemployment, sound economic and demographic fundamentals, and stretched affordability support strong entry-level housing demand.
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