The current landmark tax legislation has already passed through the Senate and Congress. Now, it is on its way to be signed by the president. A recent survey indicated that many Americans across the United States, including several in California, are nervous about how the law will impact the ownership of residential real estate. Even so, they plan to continue buying in the new year.
According to the survey, more than 53 percent of respondents said they had concerns about home ownership. In other words, under 25 percent of the respondents felt positive about being homeowners thanks to the new law. Those particularly concerned about the new law are the wealthiest of buyers, as their incomes will rise after taxes, which will make the currently competitive residential real estate market more competitive. The increased demand very well may cause prices to rise even higher in the near future.
Real estate experts are also worried that the tax law will cause some potential home buyers to lose their motivation to buy since the cap placed on mortgages that can receive interest deductions will drop from a million dollars to $750,000. This will mostly impact home buyers in the nation's expensive markets, including California. However, most survey respondents said the tax plan will not cause them to adjust their home buying plans. Some even said they would try to buy houses more quickly.
The fact that the housing market is expected to stay competitive is good news for sellers. However, in light of this, the process of purchasing residential real estate may seem overwhelming to many buyers in the Golden State. Fortunately, an attorney can assist with the real estate buying process to make sure that one's legal rights and best interests are protected.
Source: realtor.com, "Americans Anxious About Homeownership Under New Tax Plan," Cicely Wedgeworth, Dec. 21, 2017