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The numbers may be staggering, but the calculation is pretty straightforward. It’s just a matter of multiplying publicly available total home values by the estimated impact of the bill.

Last week I wrote about how the pending federal tax reform would reduce Illinois home values, focusing particularly on the doubling of the standard exemption. Regardless of whether homeowners would get a federal tax cut, loss of any need to use the mortgage interest and property tax deductions would eliminate major incentives for home ownership, suppressing sales prices in most of Illinois and the around the country.

Let’s quantify the total potential loss in home values, nationally and locally, that would result from passage of the pending federal tax bill.

A 10% hit on home values, nationally, is the estimate of the National Association of Realtors being widely quoted in the press. Mark Zandi of Moody’s Analytics thinks it would be 10% only in more expensive housing markets, and more like 3% to 5% for the nation as a whole.

Well, the total value of single value homes is about $24 trillion according to the Federal Reserve Bank. The combined market value of homes in the six-county Chicago area is $528 billion.

So, if home values really dropped by 10%, that would mean a $2.4 trillion loss of wealth nationally and about $53 billion for our six-county area.

Even using the low end of Zandi’s estimate is eye-popping. If prices dropped by 3%, the hit nationally would be $720 billion and about $16 billion locally.

Nowhere in the debate the bill’s economic impact have I seen much discussion about the negative wealth effect of lost home value.

Mark Glennon is founder and Executive Editor of Wirepoints. Opinions expressed are his own.

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But wait. I keep hearing this is a tax break for the rich?