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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: CalculatedRisk who wrote (64679)	3/20/2007 2:32:02 AM
From: Jim McMannis	Read Replies (1) \| Respond to of 116555

RE:"Before the change, how much did you pay in taxes when you sold? Nothing if you moved up, and you received a one time exemption to move down if you were over 55." The difference is that you could DOWNSIZE and pocket the difference. Also, your one time exclusion at 55 was limited to $125k. Then there is the psychological advantage of paying zero tax. I know plenty of people who have flipped 3 times in the last 8 years. Pocketing over 1 million in tax free money. The 97' law brought flipping into it. Also driving up prices. Even if you didn't wait 2 years to flip you were caught up in the upstream brought on by the chain reaction of extraordinary events favoring real estate. The litmus test would be to eliminate the tax break but it's getting more and more a moot point as the market retreats.But is still a major enabling factor. If they eliminate property taxes in FL you'll see once again the power of tax breaks on the price of real estate. Where do you think people will move and what then happens to the price of a house? At pne time, moving down was moving the Arizona and Vegas from California. And moving from the NE to Florida where houses were cheaper. Results were bubble areas as prices adjusted up. But why did Californias prices go up? The influx had to be coming from somewhere. Flipping kicked in too.