Trump wants to end capital gains tax on home sales

Recently, Trump said he was “thinking about” ending capital gains taxes on home sales. Who benefits?

 “The biggest beneficiaries of such a change will likely be longtime homeowners in the country’s more expensive housing markets.


“Removing or increasing the capital gains limit — currently $250,000 for single homeowners or $500,000 for married couples — on home sales has been a longtime priority for the real estate industry, which argues that steep tax bills are keeping some homeowners who wish to relocate or downsize stuck in homes that no longer fit their needs.”

Sounds like a good idea to promote greater liquidity in the housing market, right? Maybe for larger homes in rich neighborhoods, but what about folks who want to downsize?

“This will primarily affect people in affluent towns and those who have owned their homes for a long time,” [Alex Caswell, founder of Wealth Script Advisors in San Francisco] said. “We have experienced a significant price increase since the lows of 2008, so anyone who bought after that period stands to benefit significantly.”

“He thinks buying and selling activity could tick up in those states if the bill were to pass, but he worries the dynamics could also mean more older homeowners with lots of purchasing power would be competing with first-time homebuyers for smaller, cheaper homes.”

Maybe just raise the capital gains limit and index it for inflation. And build more housing.

 

https://finance.yahoo.com/news/eliminating-capital-gains-on-home-sales-would-be-a-boon-for-older-homeowners-in-high-cost-states-090052929.html

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