The Senate Republicans’ tax reform plan has only been out for a few hours, but already, the reactions from prominent organizations and individuals in real estate are rolling in. Here’s a sampling of the ones we’ve received so far:
National Association of Realtors (NAR)
“Realtors are strong believers in the mortgage interest deduction as a means for keeping homeownership in reach for middle class families, but the tax proposals currently before Congress reach well beyond the MID. Eliminating the state-and-local tax deduction, further restricting capital gains exemptions for families who sell a home, limiting mortgage interest deductions for second homes, and even eliminating deductions for moving expenses; all of this, taken together along with a host of other proposals, represent an assault on homeownership that will lower home values and leave many middle-class homeowners little benefit, while others get a tax increase.”— NAR President Elizabeth Mendenhall
“While the Senate’s proposed tax bill makes the MID whole on paper by raising the cap back to $1 million in deductible interest, champions of the deduction won’t exactly be breathing a sigh of relief. Like the House bill we saw last week, the Senate’s tax bill still proposes doubling the standard deduction, and the Senate wants to completely remove the state and local property tax deduction. Under the Senate bill, Zillow’s analysis shows that in most places, even fewer households would itemize deductions, meaning an even smaller sliver of homeowners would benefit from the MID, rendering the MID a much more niche tax benefit. That is sure to cause a stir among industries that rely on widespread use of the MID.” — Zillow Group Senior Economist Skylar Olsen
California Reinvestment Coalition
“Restrictions on the mortgage interest deduction will have a larger impact on high cost states like California. Combined with other changes that will hit the pocket books of low and moderate income households, this could put homeownership out of reach for many. If there is any restriction on the mortgage interest deduction, any savings must be devoted to alleviating the affordable housing crisis and strengthening homeownership opportunities for first time homebuyers.”—California Reinvestment Coalition Deputy Director Kevin Stein
“Getting rid of state and local tax deductions is a nuclear bomb for the states where the National Association of Realtors’ really have it’s largest membership. Places like California, New York and Illinois will be crushed without the state and local tax deduction. From my perspective, it’s a non-starter. Period. Full stop.”—Illinois Realtors Government Affairs Director Brian Bernardoni
National Association of Home Builders
“We’re still waiting to see what the Senate bill looks like. Indications are that it may be more favorable. So, we haven’t taken a position on the Senate bill as of yet. We are working the Senate to try and get them to understand how bad the House bill is. What we would ask [builder/members] to do is contact their member of the House of Representatives, urge them to vote against the House tax bill. It’s bad for housing; it’s bad for small business; it’s bad for middle class America. On the Senate side, we would urge them to take a hard look at some of the pro housing provisions that people are talking about and include them in the bill.”—National Association of Home Builders President Jerry Howard
Suburban Realtors Alliance
“My immediate reaction to this whole thing is that the House plan—and now the Senate plan—are targeting middle-class homeowners to pay for the bulk of their 43 percent tax cut for corporations. We don’t think that’s fair or wise. By doubling the standard deduction, and the senate plan taking away the ability to deduct state and local property and other taxes, they’re going to basically disincentive owning a home, and the incentive for home ownership has been around for a century in this country, and it’s served us extremely well. We’ve become a nation of homeowners.
“The biggest impact for homeowners in suburbia is you’re taking a way a benefit that’s going to cause the value of their homes to drop, and, in some cases, that might mean they’re close to being under water on their mortgage. We’re just coming out of that situation, and I cannot understand why Congress would want to roll the dice in this way just to win an enormous tax cut for corporations.” —Suburban Realtors Alliance President Jamie Ridge.
Housing Trust Silicon Valley
“Bad policy rushing it’s way through Congress right now. Over 1 million affordable rentals would be lost if Congress goes forward with their tax cut bill getting rid of Private Activity Bonds and the 4% low-income housing tax credit—almost two-thirds of all the Housing Trust Silicon Valley-assisted developments in the past 2 years rely on this funding source—eliminating it would seriously set back all the recent progress made in California and regionally on affordable housing.”—Housing Trust Silicon Valley CEO Kevin Zwick, via LinkedIn
We’ll add more as they roll in.