The California Association of Realtors is fighting back against GOP tax reform plans, taking out full-page ads in seven California newspapers calling on state Republicans to oppose provisions curtailing tax benefits of homeownership.
Measures seeking to curb mortgage interest deductions, property tax deductions and capital gains exemptions will dampen homebuying while “punishing” millions of other California homeowners, the ads say.
“Tax reform shouldn’t hurt Californians, but the House of Representatives proposal does, in a big way,” the ad says. “How could any member of the California congressional delegation think this plan is good for the Golden State?”
The ads also criticize the Senate proposal to eliminate state and federal income tax and property tax deductions.
The ads appeared in Tuesday, Nov. 14, editions of the Orange County Register, Los Angeles Times, San Diego Union-Tribune, Bakersfield Californian, Sacramento Bee, Fresno Bee and Modesto Bee. Ads also appeared in the Washington edition of the Wall Street Journal and Politico.
CAR planned to hold a news conference in Sacramento Tuesday along with the California Building Industry Association, urging California’s congressmen to oppose provisions that hurt homeowners.
Under current law, homeowners can deduct interest payments on mortgages of up to $1 million. Those who now have loans won’t be affected by a provision in the House plan to lower to maximum to $500,000.
But the new limit would apply to future mortgages of $500,000 or more — a provision that would have a much more significant effect on states like California and New York that have high housing costs.
A buyer paying 20 percent down on a home of $625,000 or more needs to borrow at least $500,000. If he or she pays just 10 percent down, the buyer will need a $500,000 mortgage if the price is $555,000 or more.
Half of all existing California houses sold in September cost $555,410 or more, according to CAR data. Half of all condos or townhomes cost $450,000.
In Orange County, almost 63 percent of all homes sold this year so far — houses, townhomes and condos — cost $600,000 or more, and 48 percent cost $700,000, figures from real estate data firm CoreLogic show.
California homes selling for more than $1 million also would be affected by the House proposal to limit property tax deductions to $10,000.
The Senate version of the tax bill retains the $1 million mortgage interest deduction limit, but eliminates all…