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I have no doubt that the emotional affect of the singular line item SALT cap is having a significant effect on people's housing mood. Until they file their taxes for 2018, all people can go on is "OMG, my bill is 28K so now I'll have to pay taxes on 18K of it!" ... without any associated calculation of other tax deductions, brackets or rates that are moving in their favor.
And even if they didn't realize ANY benefit from the others, they just think 18K, they don't think 4K (25% effective rate).
Agree with this. It's not just property taxes though. The state taxes are going to be the big killer.
when speaking of 2018 and beyond taxes, I should have said "don't realize" not "didn't realize".
The SALT is what is on everybody's mind - because they know what their property taxes were, and they can go to their tax return and see what their income tax was. It's an easy sum to determine.
And undoubtedly, it has been in the past the single largest deduction.
Nope. The STATE income tax is a much bigger hit, especially as you go up the income ladder. When you are in the 37% tax bracket, if you pay 100k in state taxes, you pay an additional $37k in taxes. That's a big hit, the biggest hit. People who live in these higher value property states are likely to have a higher income, thereby being more affected by it. I think this is going to result in a mass exodus from high tax locations to lower tax states, to the extent people are free to go. I would say they can more than ever with many people able to work online from home.
My mom lives in Somers actually and house is going on market on 11/5
be great if we had a bidding war!
everything in westchester hinges on two things , school districrt and whether the town has a dedicated train station .
my son was in scarsdale. he had a tiny 1800 sq ft home with 23k in taxes . it actually sold first day on the market but he took bidders for 2 days .
he bought a 4000 sq ft home in ryebrook about 15 miles north . for just a few hundred k more he got a huge house and the same 23k in taxes as the 1800 ft home in scarsdale .
but since the kids are in private school the school district for now it did not count to heavy . the school district is a notch below best . rye brook uses the rye station so they don't have a dedicated station .
Nope. The STATE income tax is a much bigger hit, especially as you go up the income ladder. When you are in the 37% tax bracket, if you pay 100k in state taxes, you pay an additional $37k in taxes. That's a big hit, the biggest hit. People who live in these higher value property states are likely to have a higher income, thereby being more affected by it. I think this is going to result in a mass exodus from high tax locations to lower tax states, to the extent people are free to go. I would say they can more than ever with many people able to work online from home.
here in nyc we have not only the high state tax but we have a nyc income tax too .
we sold some assets in 2014 . that was the highest income we hit living in nyc .
looking at our taxes for the year we sold the lease rights , i show total income including the gain on the lease rights of 461,136.00
bottom line federal taxes were 89,387 , new york state taxes 28,604 and nyc taxes 15,021.00.
so you would have to earn well over a million a year to pay 100k in state and local taxes here .
while an extra 37k is a lot ,the income needed to pay 137k in state and local taxes would be well in the millions . it would think it would be pretty irrelevant to those in that income range every year . if like us , it was a one shot deal , well i certainly would not move over it . so i certainly see no mass exodus from this as it effects very few . most people can't even itemize under the old numbers .
the good news is that now that we retired in nyc we hardly pay any state and local taxes . we have a 6 figure income too but most of what you get in retirement is not taxed locally .
ss is not taxed , my wifes city pension is not taxed , the first 20k in retirement money is not taxed and all the treasury bond interest we get is not taxed . i am amazed at just how little we pay in state and local taxes now simply because ny does not tax so much in retirement .
Last edited by mathjak107; 10-28-2018 at 04:28 AM..
When a family is ordered to pay $12,000 a year for health insurance with a $5,000 deductible, that's $60,000 in five years and $180,000 in fifteen years. That's a very nice house in some areas in theNortheast. That's a very nice house a family cannot afford. Maybe this health insurance situation will get sorted out, but in the interim you can family health insurance for half the price. You get all the coverage with NO deductible for $600 a month with Liberty Medical. However, they do not pay for abortions.
With a $90,000 drop in living costs over the next 15 years, that family could buy that hose; a business could expand; a family could buy a boat or an airplane. Our economy could improve. Sure, the unemployment rate is at 3.8%. That is nice, but the gorilla inthe corner is mandated expensive health insurance.
The market is slowing down because of a lack of supply . Like I said my son sold his for about a million and they had a bidding war . He bought a house for over a million and bought it the day it listed . There is just a shortage of quality left.
Those leaving ny are boomers retiring who can’t afford to live here , or just plan planned to leave when they retire ,not the wealthier people
The market is slowing down because of a lack of supply . Like I said my son sold his for about a million and they had a bidding war . He bought a house for over a million and bought it the day it listed . There is just a shortage of quality left.
Those leaving ny are boomers retiring who can’t afford to live here , or just plan planned to leave when they retire ,not the wealthier people
The lack of supply thing has been going on for a while now. It's not new. This recent phenomenon of prices dropping isn't lack of supply. That doesn't even make sense.
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