With the new Tax Cuts and Job Acts bill in effect, homeowners are raising concern about the amount of mortgage interest they can deduct from their taxes.
In a recent article, published by the National Association of Realtors, these concerns are addressed, but so are some of the significant provisions. The NAR claims that many homeowners, homebuyers, real estate investors, and NAR members will benefit as a result.
The major provisions of the new law are outlined in the NAR article (read here), as well as the current laws that will be retained under the final bill. Most notable is the retention of the existing law: Exclusion of Gain on Sale of Principal Residence. Both the Senate-passed bill and Congress-passed bill would have changed the stipulations of this law, making this a significant victory fought-for and won by the NAR.
While the new law does include many provisions, such as lower taxes for individual filers – the NAR predicts “a slower growth in home prices of 1-3% in 2018 as low inventories continue to spur price gains.” The article also goes on to note that, in some areas of the US with high cost and high tax, home prices may drop because of the restrictions on mortgage interest and state and local taxes.
We suggest that all homeowners, future buyers, investors, and commercial real estate professionals read up on and learn about the new tax laws (you can read the official and final bill here), as there are many changes. We also recommend reading through the article posted by the NAR as it is straightforward, informative, and provides practical examples of how the law impacts specific homeowners.
As always, if you have any questions, please don’t hesitate to contact our experienced and friendly real estate team at Woodleaf Realty. While we won’t be able to answer your tax and mortgage questions specifically, we can refer you to some of the most knowledgeable professionals in Colorado Springs. And, while we’re at it, we can answer your questions about buying and/or selling your home in the Pikes Peak region!