Subj : Re: Chinese Scientists Cr
To   : Rob Mccart
From : Kurt Weiske
Date : Mon Feb 24 2025 09:00:23

-=> Rob Mccart wrote to MIKE POWELL <=-


 RM> I don't know if it's universal but I believe you guys can write off
 RM> your mortgage payments (or interest?) against your income at tax time
 RM> which saves you a lot of money.

In the US, it's interest payments that are a tax deduction.

 RM> Here our advantage is your *Principal* residence can be sold at a
 RM> huge profit without any Capital Gains tax involved.

Yeah, that's where it gets muddy with short term and long term capital
gains - I think there's a loophole somewhere if you use the proceeds of
a primary residence to buy another primary residence.

 RM> What they will probably do to lower prices is, cut immigration so
 RM> there isn't as much os a shortage of housing, cut taxes or even give
 RM> grants to builders putting up housing that will sell cheaper, which
 RM> should force all prices down some, and they may come up with something
 RM> like charging Capital Gains tax on, say, anything over $200,000, of
 RM> profit you made when you sold your house, and use that money to
 RM> encourage those lower cost builders (in a perfect world).

I'm pretty pessimistic about attempts to lower housing costs. The
administration has extending the 2017 tax cuts a priority, so cutting
taxes on the middle class would hamper that effort. Housing is a
high-stakes, high-income game, I don't know how popular a grant program
for market-rate housing would go.

With current income, you have people retiring with well paid-off
mortgages, and unfortunately quite a few people who'd take a haircut if
they sold because of either their existing mortgage or the current
rates. I refinanced at the bottom, I know I'm not making any lateral
moves!  :)

Once the market dips, then you have people underwater on their
mortgages. You may see people letting the banks forclose, causing more
uncertainty and instability in the market.

It's easy on the way up, difficult to bring prices back down.

Landlords aren't any better - rents are a trailing indicator. Around
here, it takes a long time for rents to start coming down, you'll see
landlords convinced that the apartment they rented for $2000, then
bumped the price up to $3200, is still worth that when the market cools.


 
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