Owning Versus Renting Across Income Brackets

REALTOR® University recently hosted a webinar entitled “Owning Versus Renting Across Income Brackets Under the Tax Cuts and Jobs Act” featuring Dr. Ed Golding, non-resident fellow of the Urban Institute and former head of the Federal Housing Administration.

Here are a few of his forecasts based on 2018 Tax Reforms:

• Renting will look more attractive than homeownership for many
• For families above the median income, there will be a significant effect with the all-in user cost of ownership increasing by 25%+
• Higher income families could easily be paying an additional $10,000 in state taxes
  • $300K HH: value of 2018 housing tax deduction dips from $15,706 to $5,222

  

  Breakeven Calculations were based on these Assumptions, producing these Results.

• Expect a lower homeownership rate under the new tax law
  • Young households delay ownership
  • Older households move to rental properties earlier

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  Tax Reform Impact on Real Estate Professionals

  Tags: Dr. Ed Golding, owning versus renting, tax reform, Urban Institute