How the New Big Beautiful Bill Helps Homebuyers in 2025 Congress passed the One Big Beautiful Bill (OBBB) - a sweeping tax update that’s shaking things up for homebuyers across the country. And if you live in California, where high home prices and taxes are the norm, you’ll want to understand how this new bill affects you. Let’s break it down and see who benefits, how much they can save, and why this could be the perfect time to buy or move up. The New Tax Landscape in 2025 Here are the key tax changes under the OBBB that matter most to homeowners: Standard Deduction Stays High $29,200 for married couples filing jointly $14,600 for individuals This helps simplify taxes for many Americans, but there’s a catch: If you don’t have enough deductions, you won’t itemize, and that means your mortgage interest and property taxes won’t really reduce your tax bill. SALT Deduction Jumps from $10,000 → $40,000 (2025 - 2029) This is huge for Californians. SALT stands for State and Local Taxes - and includes: Property taxes State income taxes Under the old $10,000 cap, many homeowners in high-tax areas like L.A., San Francisco, or San Diego couldn’t deduct all their taxes. Now, they can - up to $40,000! That’s a real money-saver. Real Examples: How Much Do Buyers Save? Let’s examine a few purchase price points, assuming a 20% down payment, a 6.75% interest rate, and a 24% tax bracket. $800,000 Home Loan: $640,000 Property Tax: ~$10,000/year Mortgage Interest (1st yr): ~$43,200 State Income Tax (Income: $175K): ~$14,875 Total Itemized Deduction: $40,000+ Tax Savings: $2,592/year (~$216/month) $1,000,000 Home Loan: $800,000 Property Tax: ~$12,500/year Mortgage Interest (1st yr): ~$54,000 State Income Tax (Income: $225K): ~$19,125 Total Itemized Deduction: ~$66,500 Tax Savings: $8,952/year (~$746/month) $1.5 Million Home Loan: $1.2 million Property Tax: ~$18,750/year Mortgage Interest (1st yr): ~$81,000 State Income Tax (Income: $250K): ~$21,250 Tax Savings: $7,200/year (~$600/month) What About Less Expensive Homes? For homes under $600,000, the benefits of itemizing drop off. For example: $500,000 Home Loan: $400,000 Mortgage Interest: ~$27,000 Property Tax: ~$6,250 Total Deductions: ~$33,250 However, because the standard deduction is $12,200, the net benefit from itemizing is minimal, just around $60 per month in savings. Most people in this range won’t hit the $40,000 SALT cap either. Why Real Estate Agents Should Be Talking About This This tax law is a significant selling point for agents working with clients who want to upgrade to a larger or more expensive home. Key Talking Points: “Buyers of $1M+ homes can save up to $600 - $750/month in taxes for the next five years.” “That $1.5M house might feel like you’re only paying for a $1.35M home thanks to tax savings.” “These benefits expire after 2029 - the clock is ticking!” Especially in a market with higher interest rates, this extra savings can tip the scale for hesitant buyers. Final Takeaway: Use It While You Can The One Big Beautiful Bill gives California homebuyers a unique five-year window (2025 - 2029) to: Deduct significantly more in taxes Reduce their effective housing costs Afford more Home without feeling the full brunt of rising rates If you’re in the market for a home $800,000 and up, this is your moment. Let’s Talk Strategy Whether you’re a buyer trying to stretch your budget or an agent helping clients weigh their options, understanding these numbers can save thousands. If you’d like help running the numbers for your situation or that of your clients, please reach out anytime. Let’s make this beautiful bill work in your favor. Please let me know if you have any questions or if a client needs my guidance. I’m just a call, text, or email away. 📞 Cell: 661-714-6258 📞 Direct Line: 661-291-2222 📞 Office: 661-260-2970 ext. 2222 📧 Email: Mike@AugustaFinancial.com But wait, there’s more… Interest Rates We finished June strong with 8 of the last 10 days seeing interest rates fall! We have zero good days for July, as every day has pushed rates a tad higher. Loan Programs We do loans on Non-warrantable condos! We offer 12-day escrows for pre-approved buyers - Conventional/FHA/Jumbo/Bridge loans. We provide loans in all 50 states, so call me with anything you need. Government loans (FHA/VA/USDA) are in the high 5’s and low 6’s. Conventional loans up to $806,500 are in the low to mid 6s. High Balance Loans from $806,501 to $1,209,750 are also in the 6’s. Jumbo loans above $1,209,750 are in the 6’s and 7’s. Bank statement loans are available with 10% down again, with larger down payments in the 6’s ++. Profit and Loss Statement loans require 20% down - no bank statements needed, only a profit and loss statement! 0 down loans are available in the high 6s, with a minimum credit score of 620, up to $1,300,000. Private Money lenders offer Hard Money Loans with 35% down. No Ratio Loans require 30% down. DSCR (Debt Service Coverage Ratio) loans are available with as little as 15% down. Bridge Loans typically have an interest rate of 7.99% with limited fees, helping you get where you need to go! 3/2/1 Buydowns, 2/1 Buydowns, and 1/0 Buydowns are available at great starting rates! Please note that interest rates are subject to change without notice, and the information above reflects LA County Loan Limits. **Good News for Condos:** Cornerstone – It looks like it will be coming off the Fannie List shortly! American Beauty Village East – Off the naughty list! Canyon Country AKA Canyon Gardens - new insurance provided - American Beauty GARDEN – YAY! American Beauty Classics – Terrific **Bad News for Condos*** Parklane Condos – Simi Valley CA – Insurance is adequate! Park Northridge HOA – 19533 Rinaldi – Critical repairs and deferred maintenance MARIPOSA – Another setback! Now, they have 19% delinquencies to be added to an already too-high deductible on their insurance. The full state of California naughty list has been added to MikeMeena.com! See the link below: https://mikemeena.com/non-warrantable-condos/ Let me know if you hear anything new about condos or townhouses. I am available every day if you need anything. 📞 Cell: 661-714-6258 TEXT: 661-714-6258 📞 Office: 661-260-2970 ext. 2222 📞 Direct Line: 661-291-2222 📧 Email: Mike@AugustaFinancial.com Have a great day and an even better tomorrow! Please call me when you have a client who needs to borrow! Mike Meena President | Loan Officer Click to Call or Text: (661) 714-6258 This entry has 0 replies Comments are closed.
