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Tips to Homeowners

January 11, 1987|Armand L. Fontaine

Question: Will the new tax law increase the cost of single-family residences?

Answer: Tax reform may encourage some people to sell their present home and buy a new, more expensive one. That is because the legislation limits tax write-offs from refinancing their current home to its original cost, plus improvements.

Therefore, the theory goes, that some individuals who would like to borrow with tax deductibility may sell their present homes, which they purchased at a much lower price several years ago, and buy a new home to receive a larger loan commitment and bigger tax deductions.

However, I would caution that upon the purchase of a new home, their tax assessment will be based upon the value of the new house, and their property tax payments will probably be much higher.

I believe that we can look for home equity-financing to become the primary type of consumer loan in the foreseeable future. This might cause interest rates on home loans to rise somewhat.

Q: Should I treat my plastic garden furniture before putting it away for the winter?

A: Yes, it is a good idea to do so. Most manufacturers of plastic-belted lawn furniture suggest washing the furniture carefully with a soft soap solution and, in many cases, to spray on Armor All or a similar product.

It is a good idea to remove most lawn furniture from the patio in order to preserve it for yet another year. The sun, rain and fog during winter, when the furniture is not in much use, can deteriorate the pieces quite rapidly.

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