Southern California homeowners may have a new reason to celebrate: the One Big Beautiful Bill Act—or OBBBA—is offering significant tax relief and incentives for property owners and homebuyers across the region. Designed to ease the financial burden of homeownership, the bill introduces several homeowner-friendly tax provisions that could put real dollars back into residents’ pockets.
Here’s a breakdown of what the OBBBA includes and how it could benefit you:
🏡 1. Expanded Mortgage Interest Deduction
The bill reintroduces and expands the mortgage interest deduction that was limited by the 2017 Tax Cuts and Jobs Act. Homeowners can now deduct interest on mortgage balances up to $1 million, up from the current $750,000 cap. This is especially beneficial in high-cost areas like Los Angeles, where home prices often exceed national averages.
🏠 2. Property Tax Deduction Increase
The cap on state and local tax (SALT) deductions, previously limited to $10,000, is now raised to $20,000 under OBBBA. This adjustment provides much-needed breathing room for Californians who pay some of the highest property taxes in the country.
🔁 3. Tax Breaks for Home Sellers
Homeowners looking to sell may also benefit. The bill allows for larger capital gains exemptions on the sale of a primary residence—up to $600,000 for individuals and $1.2 million for married couples, compared to the previous $250,000 and $500,000 thresholds. With home values climbing in SoCal, this change could mean thousands in tax savings.
🛠️ 4. Renovation & Energy Upgrade Incentives
Planning to upgrade your home? OBBBA offers new tax credits for energy-efficient home improvements—including solar panels, windows, and HVAC systems. There’s also a renovation tax credit for homeowners restoring older homes, which helps preserve the character of historic neighborhoods while easing the cost burden.
👨👩👧👦 5. First-Time Homebuyer Assistance
To help address the affordability crisis, the bill includes tax credits of up to $15,000 for first-time homebuyers. Combined with existing down payment assistance programs, this could open doors for many younger or lower-income buyers across Southern California.
Why It Matters for Southern California
With high housing costs, tight inventory, and rising interest rates, OBBBA aims to make homeownership more attainable and sustainable in regions like Los Angeles, Ventura, and Orange Counties. Whether you’re buying, selling, renovating, or simply trying to manage yearly tax bills, the bill offers financial relief in key areas that matter most to homeowners.
Final Thoughts
The One Big Beautiful Bill Act may sound playful in name, but it’s serious about helping homeowners. As with any legislation, it’s important to speak with a tax professional or financial advisor to understand how the bill applies to your specific situation. But one thing is clear—homeownership in Southern California just got a little more rewarding.