I keep hearing about wrinkles of the new law that I didn't know about. I had missed that one. Fortunately, I paid off my HELOC was paid off a few years ago, and I'll be able to make decisions about a new one with my eyes wide open. I feel sorry for people who took on a HELOC or large mortgage counting on being able to deduct the interest, who are now faced with a big tax hit.

If not getting a tax deduction will make you rethink a renovation, then maybe you need to save for a longer period before doing the renovation.

We save and use cash for renovation projects, so it doesn't matter what the current tax law is.

When our investments are earning more than the rate on our HELOC it makes more sense to use our HELOC rather than taking out funds and paying taxes on them as income (we're retired). So it just depends on personal circumstances.

Chispa, keep in mind that the money many people count on to save for projects is often part of their annual tax refund that will be reduced or eliminated for some people. Not everyone has extra cash to save after payday.

This sounds like another Houzz generated question and they'll use the answers for "articles" they write.

To answer the question: It won't in my case.

We didn't take take out a home equity loan for our major reno so it won t affect us. But I imagine along with the other cuts in deductions, residents of states such as NY, NJ, and CT are going to be feeling it quite a bit. Another way to stick it to the middle class. Absolutely disgusted by these tax changes.

Not affected in the least. We pay cash for all our renovations as well and we made sure we weren’t mortgage poor so we could.

Jboling: Maybe there are some who are unable to save, but I think the majority of people could if they were willing to make financial changes that would allow them to do it. It’s really all about priorities. If savings is a priority for someone, I believe they will find a way.

A couple of years ago, I did the 52 week savings challenge. Watching the savings grow got me hooked. After making changes in our spending and lifestyle habits we now sock away a little over 10,000 a year and it’s cash I didn’t see we had to save. The change with the largest impact was to simply ask do I want or need this before buying something. If I needed it, I bought it, If I wanted it, I waited. If a month later I still wanted it, I bought it, however, most of the time, I forgot about it. There are always ways to save on entertainment and utilities bills like cable and phones too, there may just need to be a little compromise to do it.

Also, whether or not it affects us personally isn't the entire issue. For instance, having a neighbor who now cant afford to paint and landscape their property absolutely has an impact on my property's value.

Should I choose to sell, buyers do look at the surrounding homes, and value does drop when your neighbors homes start to look like pigsties.

No impact - I've never taken out a HELOC loan. We were young, cash strapped homeowners at one point. We didn't take out loans to remodel - we lived with what we had and didn't remodel or even redecorate until we could afford to do it without taking out a loan. That was pretty much well into our 40's. Prior to that the most we did was replace broken down appliances, paint and other necessary repairs. We only used credit cards for "emergencies" like broken down appliances. We rarely went on a vacation unless we had loyalty points from business travel to cover it. We did however always contribute something to savings every month, no matter how small. We weathered various bouts of unemployment resulting from layoffs and serious illness. I tend to agree that there are probably people who could save and not use credit cards for elective purchases but we do have a consumer focused society with a desire for instant gratification and all the stuff everyone else has.

We've been looking to move, most likely to a house that will require some work. I do think this change will impact our plans.

I don't fully understand the purpose of this tax deduction change, but maybe it will slow down real estate flipping? Or will it fuel it now? I could see both scenarios playing out :-(

What we have is wage not keeping up with living costs, not at all about instant gratification.

How old are you @3katz4me? Because if you're retired, you absolutely have no right to compare what it was like when you were young, to what it's like now. You had purchasing power back then, we do not. If today's 30 and 40 year olds did not use their CC's and tax refunds, we'd have no economy.

Here's a short, very basic "article" explaining the differences in wages and inflation through the decades. You absolutely can not compare the 50', 60', or even 70's to what's happening today in terms of wage and cost of living.

Excellent posts, Ellie RK. It continues to astonish me how some people choose to be blind to the financial hardships faced by millions of hardworking people. And this tax bill was a kick in the teeth for them.

Vote.

I’m in the remodeling business in NJ and some people are holding off on renovations until they see what the new tax plan will actually look like. Besides ending the mortgage interest deductions, our state and property taxes are ridiculous and losing those deductions could make a difference in how much more money people will want to put into their homes.

@Kitchenwitch111 up to 10k deductions only. I'm in NYC. Doesn't it feel like he's penalizing the Blue states considering we're the ones paying some of the highest taxes in the country, and can now deduct the least.

I just wanna punch him in his orange face.

I'm not retired. The article compares the 50's with 2014. I wasn't alive in the 50's but I am familiar with the impact of inflation as I lived through the peak years around 1980. It's been relatively low since then. The interest rate when we bought our first house was 18%. Interest rates have been low for many years. I didn't feel like I had much purchasing power at $5 per hour but maybe I did.

I know there are people who struggle to meet their basic needs because of low income in a situation they have little or no control over. However there are many for whom that is not the case. Based on my observations of people around me there is much discretionary spending that I did not partake of when I couldn't afford it. I didn't incur debt for discretionary spending which prevented me from wasting a lot of money on interest. I don't know who pays cash and who has debt but from everything I read there is an enormous amount of debt and very little savings. My point is that some people have it within their control to improve their situation and avoid HELOC loans.

I’m retired now but my husband is still working. We also live in a high Tax state and have paid the amt in the past. Fortunately we have no mortgage debt to deduct this year, and we’ve been saving as we go for improvements over the years. Ditto for our most recent project of building a new garage, replacing the septic and reconfiguring the landscaping. Our kids are doing well now in their careers, but for a while they struggled because they had all of the best cable tv plans, iPhones with lots of features and data,and every computer game that came out. They also ate out a lot, and had a bigger tv than we did. They also took vacations every year that required air travel. They said they “had to live” even though they couldn’t afford it. They’ve smartened up since having kids of their own.

The doubled standard deduction gives more for many than interest deductions would per year. I disagree with much of this tax law but I also disagree with most of the present tax code we have.

Other countries, like England and Canada, do not give individualized personal itemized deductions. Both Canada and England have similar home ownership rates and renovation rates as the USA with out having interest deductions. I think most of our itemized personal deductions are very discriminatory and I wish we would get rid of all of them!

edited to add, I am in ct, pay more than the max deduction in property tax and state income tax but still think the fact that I can afford a house with taxes that high and make an income that is high enough to pay high taxes means I should not get any tax break! It is specifically us who should not get breaks, rent should be the deduction not your tax on your very expensive property or interest on you new needless kitchen.

The interest deduction on home equity loans and the cap on property taxes and state taxes does not hurt the poor middle class it hurt the top twenty percent of earners or owners of expensive property...oh woe is me! I think we have to stop calling fortunate people the " struggling middle class" my taxes should have been raised years ago to offset the deficit.

In pretty much all developed countries college, med school, law school, etc are free, and retirees can live on their pensions.

They are not free. My husband is English. My sister in law's family make the same income as my family. They pay over thirty thousand pounds (50k in Usd) per year more in taxes than my family. That times 18 years is more than I will pay for my children's education and health insurance. She also pays a 20% value added tax on all items less food, her kids pay 15kUSD ( over 9,000 pounds) IN TUTION FEES and at times have paid more than 10usd per gallon for petrol.

That is not free health or school the gov collects the money and gives it towards meds and college we pay direct but we all pay the same amount In the end. But it is fairer to all. Not only do rich and middle class get health and school so do lower classes but it means no deductions and very high taxes. It also means real middle class and above will pay more than their " fair" share to ensure the greater good. This will make more moaning than not being able to deduct your million dollar homes property tax seem painless...

the US has more disposable income per capita than everywhere but Luxembourg as an historic rule even with our direct pay system. This is actually why I want more taxes to pay for universal care but the reason it does not go through is sticker shock would kill it at the polls if done right.

The inequity of the tax bill is that it didn't eliminate all deductions, just targeted states whose voters believe in public services. The charitable deduction is preserved -- some 80 percent of which are religious. A contribution to a religious school is deductible while support for public education - schools, libraries, training programs - now are not! But to your original question... here in Westchester County, NY, hardest hit under the new scheme, we are looking at declines in property values of more than 10 percent. Most of the county has still not recovered from the recession of 2008. Yes prices here may seem astronomical, but it's supply and demand. A few metropolitan areas in the country are the engines of growth for the country and have to house growing populations in already densely populated conditions. Our houses are not expensive because they are more opulent than yours. We frequently hear what rat holes they are from people who can't understand why anyone would put up with living in NYC. Well thanks for making the situation worse..

Kitasel, I agree that all personal deductions should have been eliminated. Itemized deductions always favor some groups over other groups and that is why I find them to be discriminatory by nature.

I too,am on the metro north line and we never had the devaluation of equity that most of the country had in 2008. Getting rid of property tax deductions is maybe just finally righting the over inflated property costs in the NYC, Boston and San Fran markets. It is more than supply and demand, these markets are bubbles and their burst will open up opportunities for less fortunate people to finally enjoy owning in these areas as well perhaps, or at least I can hope it does. Again I am fiscally hurt by the 10k cap aswell but compared to the other real issues with the bill this is nothing to complain about.

The tax brackets going down by significant percentages in upper middle and upper classes is what I find horrendous about this bill. Not the fact that these same groups, of which I belong, now have to pay on their property wealth and property additions...

Taxes for many of us are too low and if we want better futures for our kids it is time we admit it and stop looking for breaks. I dislike this bill because it lowered taxes over all not because it did away with a few luxury deductions like expensive houses and extensions.