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New Tax Plan May Boost U.S. Apartment Sector
The recently-enacted U.S. tax reform bill is poised to benefit the U.S. multifamily investment market, according to CBRE. Researchers looked at the implications of tax reform on the multifamily sector in the largest 35 U.S. markets.
CBRE’s Spencer Levy says, “The new tax policy’s raising of the standard deduction, combined with limitations on mortgage interest and state and local tax deductions, will significantly increase the attraction of renting versus buying housing. This could potentially provide a boon to multifamily investors in many markets.”
CBRE’s analysis found that tax reform, which makes the increased standard deduction of $24,000 for a married couple available to renters as well as homeowners, will significantly benefit renters in most of the country’s largest markets, thereby encouraging renting over homeownership.
Specifically, the report notes the tax benefits of owning a home are now significantly less in 29 of the 35 markets analyzed, up from just 15 markets prior to tax reform. Major markets where the multifamily sector is poised to benefit include Miami, Philadelphia, Chicago, Denver, Seattle and Washington, DC.
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