Tax Reform Capital Gains Could Stall Real Estate Sales

12/13/2017
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Tax Reform Capital Gains Could Stall Real Estate Sales!

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9 thoughts on “Tax Reform Capital Gains Could Stall Real Estate Sales”

  1. SarcasmDetector says:

    I think this is a lot of b.s. since not that many people are buying and selling homes all that often (average ownership is over 8 years), and the tax bite for capital gains isn’t huge in the first place. Nor is appreciation in the first few years. This is another big nothing burger. Many of you kids don’t remember when you had to pay taxes on the ‘gain’ no matter how long you lived in the home, so you kept record of any home improvements to deduct from that amount. Stop all the whining and let’s move forward with lower taxes.

    1. REORealtor1 says:

      For those who think this is ‘the sky is falling’ and it won’t affect your business? I’m a homeowner and find out I now have to pay 15% capital gains if I sell going into my fourth year of homeownership. And there are others like me who can wait, let’s say that’s about 30% of the market. The Realtors, the loan officers, the inspectors, the contractors, the building supply businesses; virtually EVERYONE who works and makes money in the housing industry has just watched 30% of their income go off the table. While this might ‘even out’ down the road the pinch is going to be there next year. Also, if my gain is rather small and I have to move but this 15% is a surprise to me, I’m thinking I’ll just cut out as many people from my sale as I possibly can because by the time I’ve paid Uncle Sam his 15% AND paid another 6% to a Realtor, a fee to an attorney etc. I’m going to see if I can do this on my own. This will not only effect inventory but also the decision to move and how to make that move.

  2. Daniel Magnano says:

    I see this being a great thing for housing. It just shows that we are moving back to what the American Dream was intended to be. I understand homes were meant to appreciate over time, but when did it become protocol to buy a home and later sell with 2-5 years. The market does need to stabilize and slow down with good homeowners in place.

  3. Joe says:

    Good presentation of a subject that most people would not be aware of. I think you bring up a good point w/ the “hidden” change to treatment of sale to 5 years. Barry forgot to add that it is not just the sale price less the purchase price but also the addition of documentable improvements and closing costs made to that home that would arrive at the final cost basis of that home. In many cases the cost of those improvements and closing costs can be very meaningful.

  4. Chris Diana says:

    Three things occur to me in watching this: 1) Why the big surprise? This information has been clear in both bills since day one, and is a big part of the NAR and other protests that have been going on for weeks. 2) Closing in December could be a fine strategy, but in what world do you move an FHA, VA, RD or even Conv. loan on a closing scheduled for Jan or Feb, up to December? 3) Where are these markets where home values have been increasing 7.5%/yr for the last few years? I want to relocate!

  5. Christine M Casper says:

    am one of those who have lived in my house 4.5 years and was under contract by the time this news came out. I was scheduled to close on Jan 5, but luckily a friend alerted me to this when it came out so I was able to alert my realtor. It looks like we will be able to close this year. My home value doubled over those 4.5 years so a lot of money (60K+) is on the line.

  6. Harris Picoult says:

    The best solution would be to make the new rules applicable to homes purchased beginning January 2018. This would allow those that made plans to keep them, and for new buyers to understand what is expected.

  7. Scott Lawson says:

    Looks like a little panic over nothing. The holding period will be staying at 2 years…

  8. sarcasmdetector says:

    So you can all stop crying since the final tax bill doesn’t change the status quo of capital gains on the sale of your home. I still think it could have been changed with virtually no effect on the market. Politicians have to stop catering to special interest groups, and that includes real estate people and high tax states.

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