With the government working to overhaul the tax system, there were some unintended consequences. Those included seeing more people moving to low-tax states, which include states such as Florida and Tennessee.
In high-tax states, people spend more to live in their homes, so it makes sense that they’d choose to move to lower-tax states. In Florida, multimillion-dollar home sales have increased by around 20 percent throughout around six counties. There is no property tax in Florida.
There is a new $10,000 cap on state and local income tax deductions, which is why many people left higher-taxed states. Now, in Florida, they don’t have to worry about any cap at all, and there’s no property tax to speak of.
In states with higher taxes and lower deductions, the number of people purchasing homes has been in decline. One market that has suffered as a result is Manhattan, where there was a 12.5 percent reduction in home sales. In Brooklyn, there was a drop of around 8.6 percent. This isn’t all due to the tax changes but also because of increases in mortgage costs.
If you’re planning to buy a home, it’s worth speaking with an attorney to know where the best place to buy is. Tax laws, as well as other state and local changes, can impact how much you pay and if it’s a good idea to buy in certain areas at particular times. For now, Florida is benefiting from the changes made in the government, which is great for the local economy. It boosts sales and increases home values.