Realtor Julie Jalone

Local Real Estate Updates


Roseville, CA,- There has been a fair amount of chatter about how the tax overhaul, being signed by the President, will hurt homeownership and those of us who own homes in California.  This all centered on the tax deduction of mortgage interest but that provision of the tax bill has been limited.  As a result I don’t expect a big effect on home buying here in the Sacramento area.  There will be some impact in the very expensive neighborhoods.


Under the new plan, buyers can deduct interest on mortgages up to $750,000 on homes purchased after December 15.  Homes purchased before then are not affected.  Unless you are considering buying a home and borrowing more than $750,000 the change on mortgage interest deductions has no impact on you.  I suspect, if you are borrowing a million dollars to buy a home, the write-off is not a major concern.


Of perhaps more concern is the proposed combined cap of $10,000 in deductions for state income and property taxes.  Just yesterday I showed a home in Lincoln and with Mello Roos with a total tax bill in excess of $8,000.  This was a home on the market for less than $500,000 so it is reasonable to expect this provision of the tax bill will have some impact on homebuyers and particularly in areas with high supplemental taxes.


Some experts are concerned with the new tax bill adding to the federal deficit which would put upward pressure on interest including mortgage rates.  In addition, I have heard real estate experts are worried buyer will want to buy less expensive homes because the standard deduction is doubling and with fewer people itemizing  and using mortgage interest as a deduction.


Over all we don’t see the changes in the tax laws having any significant impact on our housing market.  If you feel differently, I would love to hear from you.  I can be reached at the MagnumOne Realty office in Roseville, 916-899-6571, or by email to JulieJ@Jalone.com.