Impact of 2018 Real Estate Taxes on Northern Virginia Housing Market

By
Real Estate Agent with Samson Properties VA0225077251

Many of my clients are wondering if the changes in 2018 deductibility of State and Local Taxes (SALT) and property taxes to $10,000 will impact housing market in Northern Virginia especially Loudoun & Fairfax County.

My initial sense is the low end or starter homes housing market will be fine. Since the rental market has been very strong (it was considered cheaper to buy than rent). While renting you cannot deduct any interest. With new rules at least the Mortgage Interest Deduction (MID) will be capped at interest on a mortgage up to $750,000 instead of $1,000,000. Most of the starter homes in Fairfax and Loudoun have taxes assessment under $10000.

For the mid-range price ($750000 to $1.5 Million) homes which is an average range for a single-family home in areas like Oak Hill, Oakton, Vienna, Great Falls, Fairfax in the Fairfax County may see a very slight impact. However, in Loudoun county areas like Aldie, Ashburn and Leesburg may not see a huge impact on the tax law for a young family offers a higher child deductible and other incentives that are offered in 2018 tax bill.

The very high end priced home from say $2+Million both in Loudoun or Fairfax will not see much of an impact. The attitude and affordability of these homes buyers will be offset with other incentives from 2018 tax laws example lower tax bracket for a cooperation or change to AMT). Being in the real estate industry for decades and seen the 2005 bubble burst the high-end home did not get impact largely at that time in the DC Metro area and I don't anticipate the same with the new tax laws.


The bottom line of the Northern Virginia 2018 Real Estate Market outlook:

Overall from what I am hearing and reading as your local real estate source for Northern Virginia I personally think the market will be stable. Fortunately, we were not flooded with investors in past few years who are flipping houses. Condo market may continue to be slower or sluggish compared to the single-family or townhomes market. The strong reasoning is many of our millennial are moving into suburbs rather than be in a small condo with a high condo fee. Unless we have a huge government or external impact in the area or economy we should be looking at a positive 2018 real estate market in the DC Metro area.

 

Please consult your financial advisor or appropriate professional before making any investment decision. 

 

Posted by

 
                             
Associate Broker
MRP, ABR, ePRO

NVAR, Life Time Top Producer
NVAR,Multiple Million Dollar Sales Club Member
Samson Properties
Cell - 703-625-4949
Email - info@eNOVAHomes.com
Web: www.eNOVAHOMES.com
 
Residential real estate agent serving Northern Virginia in Fairfax & Loudoun county over a decade and almost $100+M in sales volume experience. 


 
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Rainmaker
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Anthony Acosta - ALLATLANTACONDOS.COM
Harry Norman, REALTORS® - Atlanta, GA
Associate Broker

Good morning Ritu Desai 

Great information 

Dec 29, 2017 06:36 AM #1
Rainmaker
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Matthew Klinowski, PA
Downing-Frye - Naples, FL
Golf Community Real Estate Expert

Ritu, thanks for sharing this information.  Also, chief economist for NAR Lawrence Yun said only 5% of the country would be impacted by the changes in tax reform during an interview on CNBC yesterday. 

Dec 29, 2017 08:16 AM #2
Rainmaker
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Jeremy K. Frost
Keller Williams Realty - Dripping Springs, TX
Associate Broker, CNE, CRS, ePro, PSA

Thank you for keeping us posted and up to date. Best of luck in 2018!

Dec 29, 2017 03:41 PM #3
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Ritu Desai

Virginia Realtor-Fairfax/Loudoun/PW-703-625-4949
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