Trump: I want no more property taxes across the United States
Real estate brokers are applauding a provision in President Trump's "big, beautiful bill" that could benefit homebuyers in high-tax regions.
The measure proposes raising the state and local tax (SALT) deduction cap from the current $10,000 per year to $40,000 for a five-year period. This expansion could significantly help homeowners with higher incomes and steep property tax bills.
A group of Republican lawmakers from high-tax, traditionally blue states led the effort. Prior to the 2017 tax law signed during Trump’s first term, taxpayers could deduct the full amount of their state and local taxes from their federal returns.
In recent years, property taxes have increased substantially across the country. According to Realtor.com, the states with the highest share of properties paying $10,000 or more annually in property taxes include New Jersey (39.9%), New York (25.9%), Connecticut (19.4%), California (19.3%), and Massachusetts (18.4%).
The National Association of Realtors has supported the SALT deduction expansion as a major win for the housing market. In Texas, where property taxes are especially high, buyers might be encouraged to purchase larger or more expensive homes if they expect a bigger tax break. That could in turn open up more inventory for other buyers, says Eric Bramlett, who runs a real estate brokerage in Austin.
He notes that once people realize they can deduct more, the impact will quickly ripple through the market — starting with conversations at the accountant’s office and leading to increased activity at open houses.
Still, not all homebuyers benefit equally. Many Americans don’t pay large amounts in state and local taxes, so an expanded SALT deduction would primarily help those in costly housing markets and high-tax states. As Realtor.com’s senior economist Joel Berner puts it, the change would have the greatest effect on homeowners with expensive properties in places where taxes are already high.
Meanwhile, affordability challenges and economic uncertainty continue to keep many potential buyers on the sidelines.