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Tax Math Sends Westchester Home Sales Sliding Most Since 2011

Bloomberg logoBloomberg 7/12/2018 Oshrat Carmiel

Daniele Trissi clock stands in Scarsdale, New York, town center, March 8, 2011 © Katharine Andriotis/Alamy Daniele Trissi clock stands in Scarsdale, New York, town center, March 8, 2011 The nation’s new tax law is scaring would-be homebuyers from Westchester, a longtime refuge for families escaping New York City’s high costs.

Purchases in the northern suburban county -- which shoulders the biggest property-tax burden in the U.S. -- plunged 18 percent in the second quarter from a year earlier, the most since 2011, according to a report Thursday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. It was the fourth consecutive quarter of sales declines.

“We’re seeing buyers take a second to understand the math,” Scott Elwell, Douglas Elliman’s regional manager in charge of Westchester and Connecticut, said in an interview. “They’re spending more time with their accountants and really understanding how this plays out.”

a screenshot of a cell phone: Trimming the Sales © Bloomberg Trimming the Sales

Home shoppers are holding off on purchases in Westchester amid concerns that they can no longer write off their sky-high property taxes. Federal rules approved in December set a $10,000 limit on deductions for state and local levies -- well short of the $17,179 average that Westchester residents paid in property taxes last year, according to Attom Data Solutions.

Even before the tax changes, years of rising values were already making Westchester less affordable, said Jonathan Miller, president of Miller Samuel. The median price of homes that sold in the three months through June climbed 5 percent from a year earlier to $525,000, according to the report. Prices have increased in all but three quarters since the beginning of 2013.

The drop in transactions is likely to continue. On June 30, there were 8.8 percent fewer Westchester homes in contract than there were on the same day last year, brokerage Houlihan Lawrence said in its own report. The biggest decline was for homes priced from $1.5 million to $1.99 million. Pending deals in that range fell 17 percent to 94.

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