Trump Tax Reform and Home Prices

[morekaos]

Who cares about the repeal of the estate tax? It has never contributed much to the overall budget in...forever.  Smart, rich people find tons of ways to avoid it through proper planning anyway.  Remember when Steinbrenner paid $0 when he died?

Steinbrenner Goes Out A Real Winner

Baseball pioneer George Steinbrenner, owner of the famed New York Yankees franchise, died from a heart attack on July 13, 2010, at age 80. Checking in at No. 341 on Forbes' list of richest Americans last year and No. 880 on this year's World's Billionaires list, the Steinbrenner fortune has been estimated at $1.1 billion. (See "#341 George Steinbrenner" and "#880 George Steinbrenner III").

Many people think that the Steinbrenner family hit a home run with estate taxes when George Steinbrenner passed away. Why? In the year 2010 there are no estate taxes. In fact, 2010 is the only year with no estate taxes--in 2011 the estate tax exemption swings back to $1 million. If Steinbrenner had died in 2009 or 2011, his widow and four children would have paid an estimated $500 million to $600 million in estate taxes. Not a bad savings!

So what do Yankees fans think about this? They should be pretty happy, assuming they like having the Steinbrenner family own the Yankees. Heirs of other sport franchise owners, such as the Miami Dolphins and Washington Redskins, have been forced to sell teams to pay estate taxes.

https://www.forbes.com/2010/07/20/yankees-estate-tax-intelligent-investing-steinbrenner.html#3908e050180e

Didn't collapse the deficit then and wouldn't now.

The Estate Tax Provides Less than One Percent of Federal Revenue

Despite only a small number of estates actually paying the tax, many estates face administrative costs associated with planning around the tax. The economy experiences lost investment due to the tax.

Many countries have moved away from the estate tax as they recognize the lack of revenue the tax raises relative to the administrative and economic burden it creates. Since 2000, seven OECD countries have repealed their estate tax. Additionally, four other countries and two tax jurisdictions have eliminated their estate or inheritance taxes. In all, 15 OECD countries go without an estate or inheritance tax.

https://taxfoundation.org/estate-tax-provides-less-one-percent-federal-revenue/

 

[peppy]

Of those 99.9% about 1/4 households will see an increase in taxes.

According to the Tax Policy Center only 7% of households would see an increase in the first year.  That means 93% would pay less or stay the same.

That's year 1. What about over the next 10 years? That figure is about 25%.  Meaning, that 75% would pay less or stay the same.

Medicare will see a mandatory reduction of $25bn.

So this raises taxes?  You're twisting the discussion now.  The mandatory reduction is due to another law called PayGo, not directly related to this tax bill.

The tax plan has now become a health plan as well (ACA repeal is codified in it).

Health Insurance premiums will spike for a large swatch of that group if the ACA mandate is repealed.

Health Insurance premiums will spike for a large swatch of that group if the ACA mandate isn't repealed.  The premiums are already going up by an average of 34% this year and sign ups were at record levels.

Most in the medical/insurance industry disagree with that assessment. I'll believe them over you.

The $1.5t deficit is a burden that is shared by all.

Barack Obama - The national debt grew the most dollar-wise during President Obama's two terms. He added $7.917 trillion, a 68 percent increase, in seven years.

George W. Bush - President Bush added the second-greatest amount to the debt, at $5.849 trillion.

Ah, but now that it's Trump providing much needed tax reform everybody suddenly cares about the deficit.  The $1.5 trillion would be over 10 years and many things could be done to lower spending over that time.

The source of the deficit is what I have an issue with. For example, adding $250bn to the deficit so that we can repeal the estate tax is very different than the deficit growth due to spending that was incurred during QE/QE2.

Good luck getting sustained GDP of 4% over the next decade to patch that hole.

Trump is hitting 3% in his first year which everybody said was impossible.  Now the bar is being raised to 4%.

You want to make a bet that Trump can sustain >3% over the next 10 years.

 

[notTHEoc]

Combined with all the other provisions in the bill favoring the 0.1%, leaves you feeling like this is just a payoff to the mega donors who control the party.

Many people in Irvine work at and own shares in large corporations, so they will benefit.  The owners of corporations (the shareholders) still have to pay taxes on their earnings from owning the corporations.  Middle class people with tax-free or tax-deferred retirement accounts will benefit greatly from increases in company value and earnings without owing any immediate taxes on their gains.

Not really. This tax cut will do almost nothing for the stock market...

1. $1.5tril in cuts over 10 years
2. $150bil in cuts per year
3. Assume 40% of the cut goes directly to S&P500 after-tax profits
4. $60bil per year in extra after-tax profits for the S&P500
5. S&P500 companies will already make over $1.2tril in after-tax profits this year
6. 5% boost to S&P500 company profits

So on the surface, stocks should be worth 5% more? I don't think so because then you have to factor in all the offsets...
1) running the economy hotter is going to increase both wage and interest costs for S&P500 companies
2) adding a lot of debt will have to be paid for by taxes or cuts in the future. so some of the benefit is just a pull forward that has to be paid back later

There will be some stock market winners and losers, but overall it won't do much for stocks.

 

[Goriot]

$60 billion in additional after tax earnings or 5% does not mean 5% gain in stocks, it means $60 billion x P/E 18 = >$1 trillion in new wealth creation plus repatriation of hundred of billions in cash from overseas with amplication from wealth effect.  Also, more foreign investments to U.S. from competitive tax policies.  However, good percentage of these positive effects have been baked into the stock already which is the reason why we had a nice run up post Trump.

 

[notTHEoc]

$60 billion in additional after tax earnings or 5% does not mean 5% gain in stocks, it means $60 billion x P/E 18 = >$1 trillion in new wealth creation plus repatriation of hundred of billions in cash from overseas with application from wealth effect.  Also, more foreign investments to U.S. from competitive tax policies.  However, good percentage of these positive effects have been baked into the stock already which is the reason why we had a nice run up post Trump.

You're saying the same thing just expressed differently. S&P500 companies already have a market value around $23tril. If you increase their market value by $1.1tril, that is a 5% gain in stock market values.

Edit: Also the post-trump run-up isn't due to corporate tax reform. It's more due to synchronized global growth for the first time in decades->reduced risk of recession in the next few years.

 

[Liar Loan]

Combined with all the other provisions in the bill favoring the 0.1%, leaves you feeling like this is just a payoff to the mega donors who control the party.

Many people in Irvine work at and own shares in large corporations, so they will benefit.  The owners of corporations (the shareholders) still have to pay taxes on their earnings from owning the corporations.  Middle class people with tax-free or tax-deferred retirement accounts will benefit greatly from increases in company value and earnings without owing any immediate taxes on their gains.

Not really. This tax cut will do almost nothing for the stock market...

1. $1.5tril in cuts over 10 years
2. $150bil in cuts per year
3. Assume 40% of the cut goes directly to S&P500 after-tax profits
4. $60bil per year in extra after-tax profits for the S&P500
5. S&P500 companies will already make over $1.2tril in after-tax profits this year
6. 5% boost to S&P500 company profits

So on the surface, stocks should be worth 5% more? I don't think so because then you have to factor in all the offsets...
1) running the economy hotter is going to increase both wage and interest costs for S&P500 companies
2) adding a lot of debt will have to be paid for by taxes or cuts in the future. so some of the benefit is just a pull forward that has to be paid back later

There will be some stock market winners and losers, but overall it won't do much for stocks.

Your analysis is good but 5% higher profits is not just a one time boost to stock values.  It's also a repeating 5% higher payout to shareholders each year for 10 years, either as dividends, share buybacks, or reinvestments in the business.

 

[notTHEoc]

Combined with all the other provisions in the bill favoring the 0.1%, leaves you feeling like this is just a payoff to the mega donors who control the party.

Many people in Irvine work at and own shares in large corporations, so they will benefit.  The owners of corporations (the shareholders) still have to pay taxes on their earnings from owning the corporations.  Middle class people with tax-free or tax-deferred retirement accounts will benefit greatly from increases in company value and earnings without owing any immediate taxes on their gains.

Not really. This tax cut will do almost nothing for the stock market...

1. $1.5tril in cuts over 10 years
2. $150bil in cuts per year
3. Assume 40% of the cut goes directly to S&P500 after-tax profits
4. $60bil per year in extra after-tax profits for the S&P500
5. S&P500 companies will already make over $1.2tril in after-tax profits this year
6. 5% boost to S&P500 company profits

So on the surface, stocks should be worth 5% more? I don't think so because then you have to factor in all the offsets...
1) running the economy hotter is going to increase both wage and interest costs for S&P500 companies
2) adding a lot of debt will have to be paid for by taxes or cuts in the future. so some of the benefit is just a pull forward that has to be paid back later

There will be some stock market winners and losers, but overall it won't do much for stocks.

Your analysis is good but 5% higher profits is not just a one time boost to stock values.  It's also a repeating 5% higher payout to shareholders each year for 10 years, either as dividends, share buybacks, or reinvestments in the business.

Thanks. But I think your claim is wrong. It is one-time. Either you have a one time capital gain where the stock goes from $100 to $105 or you have a one-time dividend increase of 5%. And 5% is best case. There are many offsetting factors that probably make the stock market impact minimal (low single digit).

 

[Goriot]

My bad.  I was reading and posting from iPhone 5s screen.  Yes I still have iPhone 5s!!=) 

btw, where are you getting $1.5 trillion in cuts over 10 years?? I think the total tax cut for C-corporation and Passthrough entity is $2+ trillion for the next 10 years.  The total tax cut is about $6 trillion less $3 to $4 trillion in lower deductions mainly from individuals over 10 years with corporations getting most of the benefits of the tax cut - https://www.nytimes.com/interactive/2017/11/15/us/politics/every-tax-cut-in-the-house-tax-bill.html 

If the total corporate net profits is $1.8 trillion per annum and the top corporate tax rate declines by 15% from 35% to 20%, what is that? Probably effective tax rate is alot lower to start off for corporations.

Say the extra profit is $200 billion to all corporations then x P/E of 18 = $3.6 trillion wealth for distribution to private sector instead of big fat government x wealth effect amplification factor.

Including incremental wealth creation from reinvesting, repatriation, buyback,dividends, money turnover/velocity, etc. then probably >$5 trillion in total wealth creation which is not a chump change.

Let's see how much stock market appreciated since beginning of the year = 17% or since Trump 23% so that equals almost $5 trillion gain which probably includes adjustment for probability of successful tax reform of approximately 70%+.  If the tax reform actually happens then the stock market probably will have another little kick on the upside now that probability adjustment becomes 100%.  But, if it goes the other way and the probability goes down, then the stock will tank. We'll see. 

 

[notTHEoc]

My bad.  I was reading and posting from iPhone 5s screen.  Yes I still have iPhone 5s!!=) 

btw, where are you getting $1.5 trillion in cuts over 10 years?? The total tax cut is about $6 trillion less $3 to $4 trillion in lower deductions mainly from individuals over 10 years with corporations getting most of the benefits of the tax cut - https://www.nytimes.com/interactive/2017/11/15/us/politics/every-tax-cut-in-the-house-tax-bill.html 

I think the total corporate net profits is $1.8 trillion per annum on a post tax basis let's say it's around $2.6 trillion.  If the top corporate tax rate declines by 15% from 35% to 20% isn't that $400 billion in additional income for reinvestment, buyback dividend, etc.?
$400 billion x conservative P/E of 15 = $6 trillion wealth for distribution to private sector instead of big fat government x wealth effect amplification factor.

>$6 trillion is not a chump change.

Let's see how much stock market appreciated since beginning of the year = 17% so that equals almost $4 trillion gain which probably includes adjustment for probability of successful tax reform of approximately 70%.  If the tax reform actually happens then the stock market probably will have another little kick on the upside now that probability adjustment becomes 100%.

The main thing you?re missing is only a minority of large corporates are full tax payers at the 35% level. The effective tax rate of large corporations is 24% because of all the deductions. So the cut is only 4% overall with some corporates paying more and some less.

Yes, it?s a net tax cut of 1.5 tril with 6tril of cuts and 4.5tril of increases. The Corp cut which is getting all the focus is $1.5tril per your link.

On a net basis, individual rates don?t change much but there is a lot of redistribution out from $200-500k earners and NY, NJ, CA to other ultra-wealthy individuals and middle class

 

[peppy]

My bad.  I was reading and posting from iPhone 5s screen.  Yes I still have iPhone 5s!!=) 

btw, where are you getting $1.5 trillion in cuts over 10 years?? The total tax cut is about $6 trillion less $3 to $4 trillion in lower deductions mainly from individuals over 10 years with corporations getting most of the benefits of the tax cut - https://www.nytimes.com/interactive/2017/11/15/us/politics/every-tax-cut-in-the-house-tax-bill.html 

I think the total corporate net profits is $1.8 trillion per annum on a post tax basis let's say it's around $2.6 trillion.  If the top corporate tax rate declines by 15% from 35% to 20% isn't that $400 billion in additional income for reinvestment, buyback dividend, etc.?
$400 billion x conservative P/E of 15 = $6 trillion wealth for distribution to private sector instead of big fat government x wealth effect amplification factor.

>$6 trillion is not a chump change.

Let's see how much stock market appreciated since beginning of the year = 17% so that equals almost $4 trillion gain which probably includes adjustment for probability of successful tax reform of approximately 70%.  If the tax reform actually happens then the stock market probably will have another little kick on the upside now that probability adjustment becomes 100%.

The main thing you?re missing is only a minority of large corporates are full tax payers at the 35% level. The effective tax rate of large corporations is 24% because of all the deductions. So the cut is only 4% overall with some corporates paying more and some less.

Yes, it?s a net tax cut of 1.5 tril with 6tril of cuts and 4.5tril of increases. The Corp cut which is getting all the focus is $1.5tril per your link.

On a net basis, individual rates don?t change much but there is a lot of redistribution out from $200-500k earners and NY, NJ, CA to other ultra-wealthy individuals and middle class

Energy sector essentially pays negative tax. It's not a broad brush that gets applied everywhere. Some industries will benefit but not all of them as a whole. A good example is looking at small-cap stocks. Those are touted as the biggest beneficiaries of the new corporate tax rates.

 

[Liar Loan]

There are many offsetting factors that probably make the stock market impact minimal (low single digit).

Future actions by the Fed or Congress should not distort your otherwise good analysis.  Their actions by definition are unknowable, can't be modeled, and shouldn't be relied on when evaluating the tax plan.

 

[Liar Loan]

Chapman University has released how much they think prices in each OC city will fall under the new tax plan.  Irvine is 7th on the list at -9.9%.  This is great news for home buyers!!

Community Median Est. loss
Villa Park $1,200,000 -13.0%
Los Alamitos $900,000 -10.4%
San Clemente $875,000 -10.2%
Laguna Beach $1,620,100 -10.2%
Dana Point $857,500 -10.1%
Trabuco Canyon $860,000 -10.1%
Irvine $825,500 -9.9%
Capistrano Beach $826,000 -9.9%
Laguna Niguel $815,000 -9.8%
Silverado $815,000 -9.8%
San Juan Capistrano $800,000 -9.7%
Huntington Beach $780,000 -9.5%
Seal Beach $760,000 -9.4%
Costa Mesa $769,000 -9.4%
Yorba Linda $742,000 -9.2%
Foothill Ranch $743,250 -9.2%
Laguna Hills $715,000 -9.0%
Corona del Mar $1,876,500 -9.0%
Lake Forest $700,500 -8.9%
La Palma $710,000 -8.9%
Mission Viejo $710,000 -8.9%
Ladera Ranch $711,000 -8.9%
Tustin $694,500 -8.8%
Brea $675,000 -8.6%
Fountain Valley $662,000 -8.5%
Cypress $667,750 -8.5%
Placentia $650,500 -8.4%
Newport Beach $2,055,000 -8.4%
Westminster $627,500 -8.3%
Orange $646,000 -8.3%
Fullerton $592,500 -7.4%
Buena Park $555,000 -5.8%
Aliso Viejo $550,000 -5.6%
Garden Grove $550,000 -5.6%
Anaheim $543,000 -5.2%
Newport Coast $3,050,500 -4.4%
Santa Ana $516,000 -4.3%
La Habra $525,000 -4.3%
Rancho Santa Margarita $490,000 -4.0%
Stanton $448,000 -3.5%
Midway City $326,250 -1.4%
Orange County $685,000 -8.7%
http://www.ocregister.com/2017/11/1...rm-gives-wealthy-homeowners-surprising-break/

 

[aquabliss]

Good news guys, US Treasury Secretary says taxes will only increase for Million dollar earners.  He wouldn't lie to us would he!?https://www.cnbc.com/2017/11/17/onl...higher-taxes-under-gop-plan-mnuchin-says.html

Most of us here are doing pretty well but I aint makin $1M per year.  He better inform all those online tax calculators that their calculations are wrong.

 

[notTHEoc]

Good news guys, US Treasury Secretary says taxes will only increase for Million dollar earners.  He wouldn't lie to us would he!?https://www.cnbc.com/2017/11/17/onl...higher-taxes-under-gop-plan-mnuchin-says.html

Most of us here are doing pretty well but I aint makin $1M per year.  He better inform all those online tax calculators that their calculations are wrong.

Lol. And Trump also told us he?s going to get ?killed? by this tax plan.

Due to tribalism and the denigration of truth, most of his base will probably believe it.

 

[Loco_local]

San Clemente's median home price is  $875,000?
When did that happen? Admittedly I've been asleep the past decade, but that was always a dump. A nice dump to spend the weekend, but not to live unless you like nuclear waste, Camp Pendleton run off and Marines.

 

[Loco_local]

How could anyone doubt these honest faces ?

 

[Jantoven]

Chapman University has released how much they think prices in each OC city will fall under the new tax plan.  Irvine is 7th on the list at -9.9%.  This is great news for home buyers!!

Community Median Est. loss
Villa Park $1,200,000 -13.0%
Los Alamitos $900,000 -10.4%
San Clemente $875,000 -10.2%
Laguna Beach $1,620,100 -10.2%
Dana Point $857,500 -10.1%
Trabuco Canyon $860,000 -10.1%
Irvine $825,500 -9.9%
Capistrano Beach $826,000 -9.9%
Laguna Niguel $815,000 -9.8%
Silverado $815,000 -9.8%
San Juan Capistrano $800,000 -9.7%
Huntington Beach $780,000 -9.5%
Seal Beach $760,000 -9.4%
Costa Mesa $769,000 -9.4%
Yorba Linda $742,000 -9.2%
Foothill Ranch $743,250 -9.2%
Laguna Hills $715,000 -9.0%
Corona del Mar $1,876,500 -9.0%
Lake Forest $700,500 -8.9%
La Palma $710,000 -8.9%
Mission Viejo $710,000 -8.9%
Ladera Ranch $711,000 -8.9%
Tustin $694,500 -8.8%
Brea $675,000 -8.6%
Fountain Valley $662,000 -8.5%
Cypress $667,750 -8.5%
Placentia $650,500 -8.4%
Newport Beach $2,055,000 -8.4%
Westminster $627,500 -8.3%
Orange $646,000 -8.3%
Fullerton $592,500 -7.4%
Buena Park $555,000 -5.8%
Aliso Viejo $550,000 -5.6%
Garden Grove $550,000 -5.6%
Anaheim $543,000 -5.2%
Newport Coast $3,050,500 -4.4%
Santa Ana $516,000 -4.3%
La Habra $525,000 -4.3%
Rancho Santa Margarita $490,000 -4.0%
Stanton $448,000 -3.5%
Midway City $326,250 -1.4%
Orange County $685,000 -8.7%
http://www.ocregister.com/2017/11/1...rm-gives-wealthy-homeowners-surprising-break/

We'll see.  I'm not sure we'd see a 10% price drop in Irvine.  Even when the housing market completely collapsed last decade, and people were forced to sell because they couldn't afford their ridiculous loan payments, Irvine "only" dropped 25%.  People won't sell at a loss if they don't have to move, which means less inventory available, which will help counteract a possibly smaller buyer pool.  I feel, more than likely, we'll see more of a stagnant setting, or maybe very small declines.  I guess we'll see, though.

 

[jmoney74]

Chapman University has released how much they think prices in each OC city will fall under the new tax plan.  Irvine is 7th on the list at -9.9%.  This is great news for home buyers!!

Community Median Est. loss
Villa Park $1,200,000 -13.0%
Los Alamitos $900,000 -10.4%
San Clemente $875,000 -10.2%
Laguna Beach $1,620,100 -10.2%
Dana Point $857,500 -10.1%
Trabuco Canyon $860,000 -10.1%
Irvine $825,500 -9.9%
Capistrano Beach $826,000 -9.9%
Laguna Niguel $815,000 -9.8%
Silverado $815,000 -9.8%
San Juan Capistrano $800,000 -9.7%
Huntington Beach $780,000 -9.5%
Seal Beach $760,000 -9.4%
Costa Mesa $769,000 -9.4%
Yorba Linda $742,000 -9.2%
Foothill Ranch $743,250 -9.2%
Laguna Hills $715,000 -9.0%
Corona del Mar $1,876,500 -9.0%
Lake Forest $700,500 -8.9%
La Palma $710,000 -8.9%
Mission Viejo $710,000 -8.9%
Ladera Ranch $711,000 -8.9%
Tustin $694,500 -8.8%
Brea $675,000 -8.6%
Fountain Valley $662,000 -8.5%
Cypress $667,750 -8.5%
Placentia $650,500 -8.4%
Newport Beach $2,055,000 -8.4%
Westminster $627,500 -8.3%
Orange $646,000 -8.3%
Fullerton $592,500 -7.4%
Buena Park $555,000 -5.8%
Aliso Viejo $550,000 -5.6%
Garden Grove $550,000 -5.6%
Anaheim $543,000 -5.2%
Newport Coast $3,050,500 -4.4%
Santa Ana $516,000 -4.3%
La Habra $525,000 -4.3%
Rancho Santa Margarita $490,000 -4.0%
Stanton $448,000 -3.5%
Midway City $326,250 -1.4%
Orange County $685,000 -8.7%
http://www.ocregister.com/2017/11/1...rm-gives-wealthy-homeowners-surprising-break/

We'll see.  I'm not sure we'd see a 10% price drop in Irvine.  Even when the housing market completely collapsed last decade, and people were forced to sell because they couldn't afford their ridiculous loan payments, Irvine "only" dropped 25%.  People won't sell at a loss if they don't have to move, which means less inventory available, which will help counteract a possibly smaller buyer pool.  I feel, more than likely, we'll see more of a stagnant setting, or maybe very small declines.  I guess we'll see, though.

Yes but there are more new homes now. Inventory will be plentiful.

 

[Jantoven]

Chapman University has released how much they think prices in each OC city will fall under the new tax plan.  Irvine is 7th on the list at -9.9%.  This is great news for home buyers!!

Community Median Est. loss
Villa Park $1,200,000 -13.0%
Los Alamitos $900,000 -10.4%
San Clemente $875,000 -10.2%
Laguna Beach $1,620,100 -10.2%
Dana Point $857,500 -10.1%
Trabuco Canyon $860,000 -10.1%
Irvine $825,500 -9.9%
Capistrano Beach $826,000 -9.9%
Laguna Niguel $815,000 -9.8%
Silverado $815,000 -9.8%
San Juan Capistrano $800,000 -9.7%
Huntington Beach $780,000 -9.5%
Seal Beach $760,000 -9.4%
Costa Mesa $769,000 -9.4%
Yorba Linda $742,000 -9.2%
Foothill Ranch $743,250 -9.2%
Laguna Hills $715,000 -9.0%
Corona del Mar $1,876,500 -9.0%
Lake Forest $700,500 -8.9%
La Palma $710,000 -8.9%
Mission Viejo $710,000 -8.9%
Ladera Ranch $711,000 -8.9%
Tustin $694,500 -8.8%
Brea $675,000 -8.6%
Fountain Valley $662,000 -8.5%
Cypress $667,750 -8.5%
Placentia $650,500 -8.4%
Newport Beach $2,055,000 -8.4%
Westminster $627,500 -8.3%
Orange $646,000 -8.3%
Fullerton $592,500 -7.4%
Buena Park $555,000 -5.8%
Aliso Viejo $550,000 -5.6%
Garden Grove $550,000 -5.6%
Anaheim $543,000 -5.2%
Newport Coast $3,050,500 -4.4%
Santa Ana $516,000 -4.3%
La Habra $525,000 -4.3%
Rancho Santa Margarita $490,000 -4.0%
Stanton $448,000 -3.5%
Midway City $326,250 -1.4%
Orange County $685,000 -8.7%
http://www.ocregister.com/2017/11/1...rm-gives-wealthy-homeowners-surprising-break/

We'll see.  I'm not sure we'd see a 10% price drop in Irvine.  Even when the housing market completely collapsed last decade, and people were forced to sell because they couldn't afford their ridiculous loan payments, Irvine "only" dropped 25%.  People won't sell at a loss if they don't have to move, which means less inventory available, which will help counteract a possibly smaller buyer pool.  I feel, more than likely, we'll see more of a stagnant setting, or maybe very small declines.  I guess we'll see, though.

Yes but there are more new homes now. Inventory will be plentiful.

Yeah, that's a good point too.  So do you agree with the projected ~10% decline?

 

[the.irvine]

Chapman University has released how much they think prices in each OC city will fall under the new tax plan.  Irvine is 7th on the list at -9.9%.  This is great news for home buyers!!

Community Median Est. loss
Villa Park $1,200,000 -13.0%
Los Alamitos $900,000 -10.4%
San Clemente $875,000 -10.2%
Laguna Beach $1,620,100 -10.2%
Dana Point $857,500 -10.1%
Trabuco Canyon $860,000 -10.1%
Irvine $825,500 -9.9%
Capistrano Beach $826,000 -9.9%
Laguna Niguel $815,000 -9.8%
Silverado $815,000 -9.8%
San Juan Capistrano $800,000 -9.7%
Huntington Beach $780,000 -9.5%
Seal Beach $760,000 -9.4%
Costa Mesa $769,000 -9.4%
Yorba Linda $742,000 -9.2%
Foothill Ranch $743,250 -9.2%
Laguna Hills $715,000 -9.0%
Corona del Mar $1,876,500 -9.0%
Lake Forest $700,500 -8.9%
La Palma $710,000 -8.9%
Mission Viejo $710,000 -8.9%
Ladera Ranch $711,000 -8.9%
Tustin $694,500 -8.8%
Brea $675,000 -8.6%
Fountain Valley $662,000 -8.5%
Cypress $667,750 -8.5%
Placentia $650,500 -8.4%
Newport Beach $2,055,000 -8.4%
Westminster $627,500 -8.3%
Orange $646,000 -8.3%
Fullerton $592,500 -7.4%
Buena Park $555,000 -5.8%
Aliso Viejo $550,000 -5.6%
Garden Grove $550,000 -5.6%
Anaheim $543,000 -5.2%
Newport Coast $3,050,500 -4.4%
Santa Ana $516,000 -4.3%
La Habra $525,000 -4.3%
Rancho Santa Margarita $490,000 -4.0%
Stanton $448,000 -3.5%
Midway City $326,250 -1.4%
Orange County $685,000 -8.7%
http://www.ocregister.com/2017/11/1...rm-gives-wealthy-homeowners-surprising-break/

We'll see.  I'm not sure we'd see a 10% price drop in Irvine.  Even when the housing market completely collapsed last decade, and people were forced to sell because they couldn't afford their ridiculous loan payments, Irvine "only" dropped 25%.  People won't sell at a loss if they don't have to move, which means less inventory available, which will help counteract a possibly smaller buyer pool.  I feel, more than likely, we'll see more of a stagnant setting, or maybe very small declines.  I guess we'll see, though.

Yes but there are more new homes now. Inventory will be plentiful.

Yeah, that's a good point too.  So do you agree with the projected ~10% decline?

For sure! New homes will suffer, let?s see how Altair and great park will do, including some areas in Portola.