Bush "Tax Advisory" Panel May Recommend Higher Taxes on Housing

[Bush_Eats_Beef]

Panel May Recommend Higher Taxes on Housing
2005-08-30
The Record, Bergen County, N.J.

http://www.blackenterprise.com/yb/ybopen.asp?section=ybng&story_id=79809846&ID=blackenterprise

WASHINGTON - The status of housing as the least-taxed investment in the United States, which has helped fuel an eight-year boom in real estate values, may be in jeopardy as a presidential commission considers changes to the federal tax code.

The panel, which is headed by former Sens. Connie Mack and John Breaux and is to report to President Bush by Sept. 30, is studying options to lower taxes on many types of investments to meet Bush's goal of spurring savings and economic growth. Changes to housing- related tax incentives will also be considered, says Jeffrey Kupfer, the panel's staff director. Economists say such policies would have the effect of eroding the relative advantage housing has enjoyed over other investments since 1997, when Congress effectively made most sales of primary residences tax-free.

"One of the pillars of strength of the housing market is the fact of the tax-advantaged nature of the asset," says Anthony Chan, a senior economist at JPMorgan Asset Management in Columbus, Ohio. "To the extent that you chip away at that, you would see housing somewhat negatively impacted."

Fueled by both favorable tax-law changes and the lowest interest rates in 40 years, the national median home price has risen 69.3 percent since 1997. That year, Congress allowed homeowners to exclude up to $500,000 in gains when they sell homes they occupy, and eliminated rules requiring sellers to buy more expensive homes to avoid taxes. Before that, sellers faced taxes as high as 39.6 percent. Suddenly, homeowners could sell highly appreciated property and do anything they wanted with the proceeds. Taxes on the sale of homes that aren't a primary residence also have been reduced twice since 1997 to rates as low as 5 percent.

[nini]

1. FUCK HIM

I cant' buy another house in Calif because I can't afford the higher property taxes to begin with.

yep. go after the last freaking thing we have to hold on to.

:puke:

[napi21]

2. Well, I don't know where that national average # came from,

but my house sure hasn't appreciated anywhwere close to 69.3% since 1997! I guess in some areas it's a lot higher than that, like SF in the Bay area, but are there really enough of those to make the NATIONAL average be 69.3%?

I actually agree with the rule that states a house must be your primary residence, and you must occupy it for 2 years to get the tax exemption. That's fair. To exempt all other real estate purchases is stupid! All that does is exempt RE investors.

[Bush_Eats_Beef]

3. Median home price in Santa Clara County, CA: $750,000.

And yes, if the house is a RESIDENCE, that's one thing.

But the "house flippers" who buy 6, 7, 8 houses and more and NEVER live in them for a MINUTE...

I'd APPLAUD their downfall, because they are the ones who've made it impossible for many to even consider buying a decent home in a safe neighborhood.

[napi21]

4. What in the hell kind of salary do you have to earn to buy a

$750,000 house???? I know, I've heard about the insanity in Calif. and I've also hear about a lot of people leaving the State because the housing market is just nuts!

My son lived in Whidby Island Wash. and he constantly complained about the crazies from Cal. coming up there and making it impossible for an average person to buy a home!

I know I read the list of housing price increases across the country, and the "dramitic increase" is isolated in a few cities in a few states.

It's NOT the entire housing market!

I think we agree that a primary residence should be exempt from capital gaines taxes, and the reak estate gambler shouldn't! Just how likely do you see that happening in this era of ShrubCo????

[Bush_Eats_Beef]

5. There was a story in the San Jose Mercury recently...

...a married couple. She is a teacher, I don;t know if they specified his job (but he's NOT a CEO...he's a wage-earner, just like his wife).

They were "thrilled" to have just purchased a two-bedroom, 2-bath CONDO...not a HOUSE, a CONDO...in San Jose for $435,000.

It took both of their incomes and FIVE LOANS to do it.

FIVE loans!

The mortgage payment equals FORTY FIVE PERCENT of their COMBINED take-home pay.

If either of them get sick and can't work, they're going to learn the true meaning of "homelessness."

Realize also that MANY of the homes for sale here are "fix-er-uppers"...a euphemism for "toilet"...and they are often in BAD neighborhoods.

[napi21]

6. I only hope things won't go south for these people!

I remember, in 1994, when I was relocated to San Antonio, I told the realtor the price house I was interested in. She and the lender tried to tell me I could qualify for a much more expensive house, and that's what I should do!


I didn't! I was always concerned about what would happen if I lost my job, or something else bad happened. I never had the mindset where I could just declare bankruptcy and go on.

Well, after 4 years, I did lose my job, and we held on long enough to sell the house with a bit of a profit, and we moved to PA, and ultimately to Ga.

I guess you have to have a different attitude than I have, to be able to take on 5 loans!!!!!

I'm very afraid we are looking at many, many foreclosures, and not in the distant future either!