Well, 2018 will be the year we begin to find out the impact of tax reform on housing prices and home ownership. Already, we have seen over 7500 DC residents prepay their 2018 property taxes in order to partially avoid the cost of this new legislation. While there are some early, rough estimates available of its overall impact on housing, consumer behavior will also play a huge role in this. Buying and selling a home is not always an entirely rational process. After all, while it is an investment, it is also your home.
In other news, we’ll look at some ways to forget (if only briefly) that it’s freezing outside. And, Bitcoin continues to creep into the real estate market. Now, there’s a Miami condo for sale where the owner will only accept Bitcoin! Enjoy your weekend & stay warm!
We’re all freezing and likely will be for a while. If you can’t escape the frigid temperatures, you can at least dream of warmer climates and a trip to the beach. Perhaps adding some photography from Gray Malin or a classic Slim Aarons would brighten your day? Beach and ocean photography is not just for a home at the beach or on the coast. Here are just a few examples of some amazing beach photographs in not so beachy homes. And, it doesn’t have to be a large focal point. Why not layer it in smaller size with other photographs or art? I guarantee you it will make you smile when it catches your eye and help you to forget, if only for a moment, that it’s single digit temperatures outside!
LOCAL REAL ESTATE & DEVELOPMENT
DC residents pre-paid more than $50mm in 2018 property taxes before year-end! A slew of residents lined up and pre-paid the taxes in order to avoid the impact of the new tax legislation. Unfortunately, Maryland residents were not so lucky. Just before year end, the IRS clarified the looming question on prepayment by stating that you could only prepay if your 2018 taxes had already been assessed. While 2018 taxes had been assessed in DC, this was not the case in Maryland.
In development news, it is with great disappointment that I must report that Johnson’s Florists and Garden Center in Tenleytown is closing any day now. According to the reports, they were unable to negotiate an affordable rent for the space. AU is their landlord and there is no news on what will take Johnson’s place. First, Barnes & Noble in Bethesda and now this… sigh.
REAL ESTATE, INTEREST RATES & MORTGAGE NEWS
The overwhelming question in the real estate market in 2018 will be the impact of the new tax legislation. While it is definitely too early to tell, most estimate that the changes will have a somewhat negative affect on home prices. The Washington Post estimates a 4% drop nationwide, with high tax states feeling the impact more. This is based on an analysis by Moody’s where they have lowered their forecasts for housing prices by roughly 4%. To be clear, this means that housing prices will be 4% lower than they would have been barring the change in tax legislation. Curbed has a great info-graphic that allows you to see the impact by region. It shows the DC Metro area falling in line with the national average of -4%.
Last year, I wrote a bit about Bitcoin, blockchain and its potential impact on the real estate market. Now, there’s a one-bedroom condo for sale in Miami where the seller will only accept Bitcoin as payment – 33 bitcoin to be precise, that’s about $542,000… $548,000… $551,000… $539,000… oh forget it, it keeps moving! According to Redfin, there were 75 listings on its site where Bitcoin would be acceptable payment, though they would also accept old fashioned US dollars.