If Tax Deduction.On Second Homes Go...

The Las Vegas valley’s second-home market will be the worst hit if there is a deduction of federal tax on mortgages. There could be a major effect on the Las Vegas real estate if there is any reduction in the deduction of interest on investment properties, vacation homes and home equity loans.

More than 175 towers having nearly 50,000 luxury condominiums are targeted for the investors and the second-home buyers. Cities leading developments also depend on vacation-home buyers. The local and national economy will also be affected if the deduction is taken away. The rising interest rate will also prevent people from investing in real estate.

About 21.2% of the new homes sold in Las Vegas are bought as vacation-home or investments. The $5 billion project, City Center on the Strip and the $3.5 billion Las Ramblas on the Harmon Avenue depend heavily on the vacation-home buyers. Most of the condo –hotel projects are aimed at the investors.

Any move by the federal government to take away the tax benefits for the second homes can have a devastating effect on the real estate market in Las Vegas.