The housing market just got a major jolt.
President Trump’s recently passed “One Big Beautiful Bill” introduces a sweeping set of tax changes and regulatory updates that could reshape real estate across the country. If you’re thinking about buying a home, investing, or even just watching from the sidelines, it’s worth understanding what this bill could mean for you.
Below, we’ll break down how it affects prices, affordability, interest rates, and your best move going forward. Spoiler alert: buying now and refinancing later might make more sense than you think.
What’s Actually in the Big Beautiful Bill?
The bill brings some big updates to real estate policy and taxation. A few standouts include:
- Expanded mortgage interest deductions
- A renewed deduction for mortgage insurance premiums
- A higher cap on state and local tax (SALT) deductions – now up to $40,000 for couples under $500,000 income
- Reduced funding for regulatory enforcement (such as the CFPB)
- No major supply-side housing reforms like zoning or builder incentives
It’s a bill that mostly encourages demand and gives buyers more financial wiggle room. But that also means competition might heat up fast.
Home Prices Are Likely Headed Up
Because many buyers will now see a drop in their after-tax cost of homeownership, they’ll feel empowered to spend more. That’s especially true in higher-cost areas like California, New York, and New Jersey where the expanded SALT cap has a big impact.
In short, more people will re-enter the market with stronger offers.
This likely creates upward pressure on home prices, particularly in mid-to-upper-tier markets. If you’re waiting for prices to dip, this bill may have just made that less likely.
Affordability Looks Better on Paper, But the Real Story Is Mixed
On the surface, the tax deductions make homes more affordable. But affordability isn’t just about what’s on paper – it’s about what you can actually buy.
The bill does nothing to increase housing supply, fix zoning, or encourage new construction. So while some families may qualify for more, they’ll still be competing over the same limited inventory.
That mismatch between demand and supply may cause prices to climb faster than wages, keeping true affordability out of reach for many.
What About Mortgage Rates?
Many are hoping for mortgage rates to drop. But this bill makes that less likely in the near term.
Here’s why:
- The bill increases government spending without offsetting cuts, which grows the national deficit
- More deficit means more borrowing, which tends to push Treasury yields higher
- Mortgage rates follow the 10-Year Treasury closely, so those could rise as well
- Inflation risks also increase, and that could cause the Federal Reserve to hold off on rate cuts or even consider raising them again
So while we’re not expecting a massive spike in rates, the odds of rates dropping significantly just got a little slimmer.
Current projections suggest mortgage rates may hover in the 6.3 to 6.7 percent range, possibly higher if inflation comes back into focus.
Why Buying Now and Refinancing Later May Be Your Best Move
Waiting for the “perfect” rate or the “right” time can be risky, especially in a market like this.
Here’s why buying now, and refinancing later, may make more sense:
- Home prices are expected to rise again, so buying now helps you get in before things become even more competitive
- You can always refinance when rates come down, but you can’t go back in time and buy at last year’s prices
- If rates stay flat or rise, you’ll be glad you locked in a payment sooner
- Strategic tools, like rate monitoring and mortgage management, make refinancing simple when the time is right
In other words, you can protect your future without missing the opportunity in front of you today.
How NEO Home Loans Helps You Win in This Market
At NEO, our job isn’t just to get you a mortgage, it’s to help you build wealth through real estate and make confident financial decisions along the way. That’s especially important in a market that’s shifting due to new legislation like the Big Beautiful Bill.
Here’s how we’re helping homebuyers take advantage of today’s opportunities:
- A Smarter, More Strategic Approach to Buying
We’ll help you go beyond the basic pre-approval by equipping you with powerful tools to compete and win in today’s market:
- Appraisal gap strategies that give sellers peace of mind and give you an edge in multiple-offer situations
- Seller-paid subsidy programs, where we negotiate to have the seller cover part of your interest rate, lowering your monthly payments for the first three years and helping you ease into ownership
It’s all about increasing your confidence while protecting your budget.
- Ongoing Support After You Close
Your mortgage shouldn’t be a set-it-and-forget-it decision. As part of the NEO experience, we’ll continue to monitor your interest rate and alert you the moment a refinance could help you save money or reach your goals faster. No guesswork. No missed opportunities. Just smart, proactive guidance from people who have your back. - Education You Can Actually Use
This market is complex, and new policies are constantly shaping what’s possible. We’ll help you understand how to take advantage of new tax breaks, navigate affordability challenges, and make the most of your loan structure, all without the jargon. - A Long-Term Financial Partner, Not Just a Lender
Whether it’s helping you plan your next move, optimize your home equity, or set up long-term wealth strategies, we’re here to help you thrive, not just survive, in real estate.
Conclusion
The “One Big Beautiful Bill” changes the housing landscape, but not always in obvious ways. While it may make things feel more affordable for some, the real effect is likely to be higher prices and steady or rising mortgage rates.
If you’re serious about buying, now may be the moment to take action, not because the market is perfect, but because you can lock in your next move before prices and competition heat up even more.
You don’t have to figure this out alone. Whether you’re buying your first home, upgrading, or investing, we’re here to help you build a strategy that works for you.
