Average home prices will drop an estimated 4 percent nationwide as a result of the new tax law. The new caps on the mortgage interest and state and local tax deductions included in the price of homes for sale will make prices seem lower.
Renters may not feel any impact. Some experts believe the new law will put downward pressure on rent, since tax incentives for developers are still in place and there could be more supply. Meanwhile, homeowners in cities where owning a home will cause one's tax bill ro rise may have some of the cost offset by a drop in individual tax rates and thresholds, Curbed reports. These cuts across all income levels will impact individual brackets differently, and are set to expire in 2025.
“It’s very hard to come up with how this is helpful to housing,” said Jonathan Miller, President and CEO of Miller Samuel Inc., a real estate appraisal and consulting firm “It’s either neutral or negative; there’s no positive, at least that we’re aware of at the moment. All this does is make everything more expensive, at least in high-cost housing markets.”
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