Southern California home sales crash in warning sign to nation

[CreekDog]

11. The mortgage deduction is 750k now, but I think that's not the main culprit here

The 10k cap on State and Local taxes really changes the affordability picture.

a 750k house will have property taxes about $8000/year. Prior to this, it was fully deductible which for someone in the 25% tax bracket, would make those taxes equal to $6000/year.

Now the cap will apply to the combined state income and property taxes and even those who aren't necessarily highly paid will hit that cap before they've paid much property tax.

And before anyone scoffs at homebuyers here, because of their income, keep in mind that a lot of us couldn't find rentals or if we could, would be priced out of them in a matter of years.

So buying a house, whatever one has to do, with a flat rate mortgage, keeps one's mortgage payment locked for the life of the loan. It is the only thing that keeps people whose wages don't rise as fast as rents or home prices here housed. Everyone should have housing stability, not just those that can afford it because they bought 10, 20, 30 years ago.