1-3-18 4:18 PM EST | Email Article

By Andrea Riquier

Homeownership overall should be resilient, however

The Republican tax bill will crimp home-price gains by making it less advantageous to itemize taxes, analysts at Goldman Sachs said Wednesday.

The analysts said that the tax law changes "should induce many homeowners to switch away from itemization. Collectively, the changes are likely to reduce the utilization of the itemized mortgage interest and property tax deductions, and in turn reduce the value of owner-occupied housing as a tax shield."

Read:It's not just lobbyists who say tax reform will slash home prices (http://www.marketwatch.com/story/its-not-just-lobbyists-who-say-tax-reform-will-slash-home-prices-2017-11-22)

To be sure, some lower-priced housing markets won't see as much of an impact, Goldman wrote, since "households in these areas typically already do not deduct their mortgage interest and property taxes."

The analysts don't give a precise forecast for home prices, writing simply that they expect price growth to decelerate. "Without consideration of tax reform, we would be constructive on U.S. house prices," they add.

It's fair to note that some housing-watchers think some deceleration in runaway home-price growth could help some markets.

Read:Why it's so hard to forecast home prices for 2018 -- and why that should worry you (http://www.marketwatch.com/story/why-its-so-hard-to-forecast-home-prices-for-2018-and-why-that-should-worry-you-2017-12-19)

-Andrea Riquier; 415-439-6400; AskNewswires@dowjones.com


(END) Dow Jones Newswires

01-03-18 1618ET

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