A long period of home price appreciation in Denver and along the northern Front Range Urban Corridor may make the area's homeowners vulnerable.
In the tax bill now before Congress, the change in the amount of time owners must occupy their homes to avoid paying capital-gains taxes has been extended from two of the past years to five of the past eight. The Denver Post reports that homeowners in metropolitan Denver and Boulder who have lived in their homes between two years and five years accounted for roughly one in five home sales since June 2016, according to data from mortgage analytics firm Black Knight.
But the change that will have the greatest impact on average homeowners is likely to be the longer holding period required to avoid capital gains taxes, said Lou Barnes, a senior loan officer with Premier Mortgage Group in Boulder. “This one will surprise people. People will sell homes and not realize they have left the safe harbor. They will wind up with a large tax obligation,” Barnes said.
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