Realtors: Higher homeownership taxes = lower housing values

Realtors: Higher homeownership taxes = lower housing values


WEST PALM BEACH, Fla.  – A tax bill making its way through the U.S. House of Representatives could slash Florida home values by 13 percent, Realtors said Monday.

Realtors harbor “grave concerns” about a Republican proposal to reduce the tax deduction for mortgage interest, end write-offs for property taxes and boost capital-gains taxes on home sales, said Maria Wells, president of Florida Realtors.

“That would affect the economy in all sorts of ways,” Wells said Monday during a news conference at the offices of the Realtors of the Palm Beaches and Greater Fort Lauderdale. “We know that housing is the canary in the coal mine.”

Proponents of the bill argue that less generous tax breaks for homeowners would be offset by a near doubling of the standard tax deduction, to $24,400 for married couples in 2018.

Realtors and many Democrats aren’t buying that argument. They say less generous tax incentives for homeownership could make homeownership less attractive both to first-time buyers and to second-home buyers.

“Most likely we are going to see a significant drop in the value of people’s homes,” said U.S. Rep. Lois Frankel, D-West Palm Beach. “Why? Because the demand for housing will go down.”

The House bill would allow home buyers taking out new mortgages to deduct interest on only $500,000 of debt, and only on one home. The package does not allow mortgage-interest deductions for second homes, or for home-equity loans.

Reflecting the mortgage interest deduction’s sacrosanct place in American politics, the Senate’s version of tax reform keeps deductions on a total of $1 million of loans on up to two homes.

In an era of rock-bottom mortgage rates, critics say the mortgage interest deduction is a benefit that accrues largely to the wealthy. But it’s a tax break that’s fiercely protected by the National Association of Realtors, a trade association with more than a million members and an active political action committee.

Both the House and Senate bills also would rein in the tax break on profits from home sales. Married sellers owe no capital gains taxes on $500,000 of profit on the sale of a primary residence, while single taxpayers can take a $250,000 profit tax-free. The new rules would require sellers to live in a house for five of the previous eight years, rather than two of the past five years, to receive the tax exemption.

The proposals also would end the practice of writing off local property taxes. Add it all up, Realtors say, and the tax proposals would discourage homeownership at a moment when the real estate market still is shaking off the Great Recession.

“We do not want to become a culture of renters,” Wells said. “We want to become a culture of homeowners.”

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Establish in 2005, Empire Appraisal Group, Inc., is Broward County’s leading residential appraisal company as a result of their accurate and reliable appraisals, excellent customer service, and quick turn times.  When working with an appraiser, integrity and professionalism are essential, and Empire Appraisal Group has a well-established reputation for providing the best appraisal experience.  Daniel Lindeman, the Chief Appraiser, is considered one of the top property appraisers in Florida, with nearly 15 years of expertise and 7,000+ appraisals to his credit.

We ‘specialize’ in helping people who need appraisals for estate purposes, divorce, bankruptcy, FSBO’s and more.

We also work closely with realtors to help establish listing prices, these pre-listing appraisals ensures sellers get top dollar for their home.

In addition, to homes of all shapes and sizes, we also appraise condos, multifamily homes, boat docks, land, as well as specialty properties. No job is too big or too small, from manufactured homes to mansions.

Call Empire Appraisal Group directly with any questions concerning your real estate values at 561-441-9298.  Also, check out our ‘Reviews’ page and see what others are saying about Daniel Lindeman and Empire Appraisal Group, Inc.

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