The Redfin-commissioned survey included more than 2,000 U.S. residents who planned to buy or sell a primary residence in the next 12 months. More than 1,800 homebuyers responded to the question: "How has the recent tax reform law affected your plans to buy a home?" Results from this survey were compared to over 1,300 responses to the same question in a similar survey commissioned in
The most common tax-reform effect reported by homebuyers this year was that they lowered their price range because of decreased benefits on high-priced homes (14%, down from 16% last year).
Another way tax reform has been affecting the housing market is in the form of migration to places with lower taxes, a trend we've noted in reports on Redfin.com user search patterns. This March, 13 percent of buyers said they shifted their search to nearby cities with lower taxes, and 9 percent said they shifted their search to states with lower taxes, down from 16 percent and 12 percent, respectively, last year.
This year, 8 percent of respondents said they are searching for higher-priced homes because the new tax law gives them additional income, down from 17 percent last year. Eleven percent of buyers this March said they decided to buy a home because the new tax law gives them additional income, down from 19 percent in the
"Last year more homebuyers were worried that tax reform would hurt their homebuying budgets, but it turns out tax reform wasn't all bad or all good for homebuyers," said Redfin chief economist
How Were Households with Different Incomes Affected by Tax Reform?
High-income homebuyers were the most likely to report in this year's survey that tax reform has had some sort of effect on their home search. Of those homebuyers earning
The largest reported effect on high-income homebuyers was that 18 percent said they have now decided to buy a home thanks to their extra take-home income, but 16 percent said they are now lowering their price range due to decreased tax benefits on high-priced homes.
Which States Were Most and Least Affected by Tax Reform?
On the other end of the spectrum,
To read the full report, complete with market-level survey data and detailed methodology, please visit: https://www.redfin.com/blog/how-tax-reform-impacts-homebuyers.
Redfin (www.redfin.com) is a technology-powered real estate brokerage, combining its own full-service agents with modern technology to redefine real estate in the consumer's favor. Founded by software engineers, Redfin has the country's #1 brokerage website and offers a host of online tools to consumers, including the Redfin Estimate, the automated home-value estimate with the industry's lowest published error rate for listed homes. Homebuyers and sellers enjoy a full-service, technology-powered experience from Redfin real estate agents, while saving thousands in commissions. Redfin serves more than 85 major metro areas across the U.S. and
For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the
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Redfin Journalist Services: Alina Ptaszynski, 206-588-6863, email@example.com