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Housing crash. People don't want to sell their house for less than they bought it for. You don't pay capital gains on the first 250K / 500K per couple of gain
by quantgenius 14y ago
Housing crash. People don't want to sell their house for less than they bought it for. You don't pay capital gains on the first 250K / 500K per couple of gains on a primary residence but you can't deduct losses or use them to offset other capital gains. In addition people are conditioned not to believe they had a loss until they realize it and of course there are underwater homeowners. You can't move if you can't sell the house you live in.
- jpdoctor 14y ago> but you can't deduct losses or use them to offset other capital gains. Not to mention: Underwater folks cannot sell if they can't afford to bring money to the table. And now that everyone who short-sells will be receiving a 1099 (after Jan1) for forgiven debt, there's going to be another disincentive. Fun times.