Cuts to Homeowner Tax Breaks Could Cost Republicans in 2018 Races

The New York Times (in a Reuters story) quoted Richard Green of the USC Lusk Center on how the Republican-backed tax reform bill could negatively impact homeowners.

Yun says his analysis suggests curbing the mortgage interest deduction would lead to as much as an 8 percent drop in housing values nationwide, and cutting property tax deductions could lead to a further drop of up to 3 percent because it would make buying and selling homes more costly. Other economists think the impact may be smaller. As refinancing of mortgages becomes less popular and consumers begin paying debt down faster, the market would rebalance, said Richard Green, director of the Lusk Center for Real Estate at the University of Southern California, who forecasts a 5 percent decline in home values.

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