\nThis is according to a March survey commissioned by Redfin of over 2,000 U.S. residents who planned to buy or sell a primary residence in the next 12 months.
\nThe findings in this report are based on responses from over 1,800 homebuyers who responded to the question \u201cHow has the recent tax reform law affected your plans to buy a home? Select all that apply.\u201d Results from this year\u2019s survey are also compared to the over 1,300 responses to the same question in a similar survey commissioned in March 2018.
\nCompared with the effects homebuyers reported a year ago, we saw the biggest drops in the prevalence of buyers indicating that they were better off because of tax reform. 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 March 2018 survey.<\/p>\n
<\/figure>\nThe most common tax-reform effect reported by homebuyers this year was that they lowered their price range because of decreased tax benefits on high-priced homes (14%, down from 16% last year). High-income homebuyers were the most likely to report in this year\u2019s survey that tax reform has had some sort of effect on their home search. Of those homebuyers earning $150,000 or more, 61 percent said that the new tax law had an effect on their home search, which was true for less than half of households earning under $150,000. It\u2019s worth noting that people\u2019s opinion of whether tax reform negatively or positively affected them in general, and their home search in particular, is likely to be skewed by their overall political leanings.<\/p>\n New York<\/a> had the largest share of homebuyers who said that tax reform had affected their home search\u201461 percent. Homebuyers in New York were most likely to have lowered their price range (17%) or shifted their home search to cities with lower taxes (17%). California<\/a> had the next-highest share of homebuyers impacted by tax reform at 55 percent. The largest effect there was homebuyers shifting their search to cities with lower taxes (18%). Thirteen percent of both New York- and California-based respondents said they were moving to a state with lower taxes. Chart above shows the breakdown for states with at least 25 individual responses to the question \u201cHow has the recent tax reform law affected your plans to buy a home? Select all that apply.\u201d<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" Over a year after the historic tax code overhaul, less than half of homebuyers say that tax reform has had an effect on their home search.<\/p>\n","protected":false},"author":13505,"featured_media":65791,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[43,51],"tags":[35],"coauthors":[],"class_list":["post-65785","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-housing-equality-policy","category-policy","tag-redfin-surveys"],"acf":[],"yoast_head":"\n
\nAnother prevalent way tax reform has been affecting the housing market is in the form of migration to places with lower taxes, a trend we\u2019ve noted in reports on Redfin.com user search patterns for more than a year<\/a>. According to the homebuyer survey, this effect is now slightly less significant than last year\u2019s survey findings suggested. 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.
\n\u201cLast year more homebuyers were worried that tax reform would hurt their homebuying budgets, but it turns out tax reform wasn\u2019t all bad or all good for homebuyers,\u201d said Redfin chief economist Daryl Fairweather<\/a>. \u201cSome homebuyers, especially in low-tax states, are now paying less in taxes overall, which has left them with more cash for a more expensive home. For others, not being able to deduct as much of their property taxes or mortgage interest from their taxable income was the other shoe that needed to drop to make them pick up and move to a more affordable area. In the long run, we will see demand for luxury homes in high-tax states suffer the most because those homes have been hit the hardest by this tax reform, and there\u2019s actually early evidence of that already happening<\/a>.\u201d<\/p>\nHow Were Households with Different Incomes Affected by Tax Reform?<\/h3>\n
\nThe 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.<\/p>\n
<\/figure>\nWhich States Were Most and Least Affected by Tax Reform?<\/h3>\n
\nOn the other end of the spectrum, Kansas<\/a> and Indiana<\/a> had the smallest share of homebuyers whose search was affected by tax reform, each at 24 percent. Washington, D.C.<\/a>, was just behind with 25 percent of homebuyers saying tax reform had some effect on their search.<\/p>\nSurvey Question: How has the recent tax reform law affected your plans to buy a home?<\/h3>\n
\n\n
\n \nState\/District<\/th>\n The recent tax reform has had no effect on my plans to buy a home<\/th>\n I’ve lowered my price range because of decreased tax benefits on high-priced homes<\/th>\n I’ve shifted my search to nearby cities with lower local taxes<\/th>\n I’ve decided to buy a home because the new tax law gives me additional income<\/th>\n I’ve shifted my search to states with lower taxes<\/th>\n I’ve started searching for higher-priced homes because the new tax law gives me additional income<\/th>\n<\/tr>\n<\/thead>\n \n Kansas<\/a><\/td>\n 76%<\/td>\n 6%<\/td>\n 9%<\/td>\n 6%<\/td>\n 3%<\/td>\n 3%<\/td>\n<\/tr>\n \n Indiana<\/a><\/td>\n 76%<\/td>\n 9%<\/td>\n 3%<\/td>\n 3%<\/td>\n 6%<\/td>\n 6%<\/td>\n<\/tr>\n \n Washington, D.C.<\/a><\/td>\n 75%<\/td>\n 11%<\/td>\n 0%<\/td>\n 7%<\/td>\n 14%<\/td>\n 7%<\/td>\n<\/tr>\n \n Minnesota<\/a><\/td>\n 68%<\/td>\n 14%<\/td>\n 7%<\/td>\n 5%<\/td>\n 7%<\/td>\n 2%<\/td>\n<\/tr>\n \n Wisconsin<\/a><\/td>\n 65%<\/td>\n 8%<\/td>\n 12%<\/td>\n 4%<\/td>\n 4%<\/td>\n 8%<\/td>\n<\/tr>\n \n Arizona<\/a><\/td>\n 64%<\/td>\n 5%<\/td>\n 7%<\/td>\n 12%<\/td>\n 7%<\/td>\n 14%<\/td>\n<\/tr>\n \n Virginia<\/a><\/td>\n 62%<\/td>\n 8%<\/td>\n 15%<\/td>\n 12%<\/td>\n 12%<\/td>\n 4%<\/td>\n<\/tr>\n \n North Carolina<\/a><\/td>\n 62%<\/td>\n 12%<\/td>\n 12%<\/td>\n 11%<\/td>\n 9%<\/td>\n 6%<\/td>\n<\/tr>\n \n Nevada<\/a><\/td>\n 61%<\/td>\n 3%<\/td>\n 12%<\/td>\n 12%<\/td>\n 6%<\/td>\n 12%<\/td>\n<\/tr>\n \n Pennsylvania<\/a><\/td>\n 60%<\/td>\n 13%<\/td>\n 9%<\/td>\n 11%<\/td>\n 7%<\/td>\n 10%<\/td>\n<\/tr>\n \n Georgia<\/a><\/td>\n 59%<\/td>\n 14%<\/td>\n 6%<\/td>\n 8%<\/td>\n 14%<\/td>\n 10%<\/td>\n<\/tr>\n \n Tennessee<\/a><\/td>\n 58%<\/td>\n 15%<\/td>\n 10%<\/td>\n 18%<\/td>\n 5%<\/td>\n 0%<\/td>\n<\/tr>\n \n Washington<\/a><\/td>\n 57%<\/td>\n 12%<\/td>\n 14%<\/td>\n 9%<\/td>\n 6%<\/td>\n 6%<\/td>\n<\/tr>\n \n Michigan<\/a><\/td>\n 56%<\/td>\n 11%<\/td>\n 15%<\/td>\n 8%<\/td>\n 8%<\/td>\n 11%<\/td>\n<\/tr>\n \n Ohio<\/a><\/td>\n 56%<\/td>\n 15%<\/td>\n 11%<\/td>\n 12%<\/td>\n 3%<\/td>\n 8%<\/td>\n<\/tr>\n \n Missouri<\/a><\/td>\n 53%<\/td>\n 15%<\/td>\n 18%<\/td>\n 3%<\/td>\n 9%<\/td>\n 9%<\/td>\n<\/tr>\n \n Florida<\/a><\/td>\n 52%<\/td>\n 8%<\/td>\n 11%<\/td>\n 14%<\/td>\n 8%<\/td>\n 13%<\/td>\n<\/tr>\n \n Massachusetts<\/a><\/td>\n 51%<\/td>\n 18%<\/td>\n 14%<\/td>\n 8%<\/td>\n 10%<\/td>\n 8%<\/td>\n<\/tr>\n \n Texas<\/a><\/td>\n 50%<\/td>\n 17%<\/td>\n 12%<\/td>\n 12%<\/td>\n 10%<\/td>\n 8%<\/td>\n<\/tr>\n \n Oregon<\/a><\/td>\n 50%<\/td>\n 23%<\/td>\n 17%<\/td>\n 7%<\/td>\n 3%<\/td>\n 7%<\/td>\n<\/tr>\n \n Illinois<\/a><\/td>\n 46%<\/td>\n 17%<\/td>\n 17%<\/td>\n 15%<\/td>\n 12%<\/td>\n 6%<\/td>\n<\/tr>\n \n California<\/a><\/td>\n 45%<\/td>\n 14%<\/td>\n 18%<\/td>\n 12%<\/td>\n 13%<\/td>\n 9%<\/td>\n<\/tr>\n \n New York<\/a><\/td>\n 39%<\/td>\n 17%<\/td>\n 17%<\/td>\n 15%<\/td>\n 13%<\/td>\n 10%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n