In the affluent areas outside of New York City, including in New York, New Jersey, and Connecticut, a federal cap on state and local property tax deductions have would-be buyers expecting sellers to cut their prices. In Westchester County, New York, the county with the nation’s highest property taxes, bills of $35,000 to $50,000 are expected, according to Bloomberg’s Oshrat Carmiel and Jeremy Hill. The writers also reported the whole county’s median prices plunged 18% in the second quarter with houses in the $1.5 million to $3 million range as the most vulnerable.
It’s a far cry from the days of bidding wars, and only likely to get worse next year. That’s when homeowners will file their taxes for 2018 and feel, for the first time, the impact of the $10,000 limit on deductions for property and state and local taxes.
“We all think next year is going to be a tough year for real estate sales,” said Matthew Roach, a property attorney in Yorktown Heights, New York.
Westchester is a particularly brutal market for people who bought about a decade ago, when prices were peaking amid bidding wars. Prices have yet to surpass those highs despite increases in recent years, according to appraiser Miller Samuel Inc. These days, buyers fear overpaying and insist on good value, said Nancy Elsas, a broker with Houlihan Lawrence in Larchmont.Read More