Tax Reform & Real Estate - Basic Things You Need to Know

Overall thoughts: Buyers getting a loan of more than $750k will be hit. This will affect the sale of properties with loans above this amount as some buyers may have become reluctant.

1. Effects on the immediate housing situation:

2. Current homeowners are in the clear. But from 2018 on, anyone buying a new home will only be able to deduct the first $750,000 of their mortgage debt. That's down from $1 million. This $750,000 is across multiple homes, not per home. So if you wanted to buy two homes with a 500k mortgage each, you will have 1Mil in mortgage debt, and you can only deduct 750k of that.

3. Homeowners who sell their house for a gain will still be able to exclude up to $500,000 (or $250,000 for single filers) from capital gains, so long as they're selling their primary home and have lived there for two of the past five years.