Authorize tax credit for new owner-occupied single family homes
Impact
The implications of SB 118 on state laws include amendments to sections 107.036 and 5747.98 of the Revised Code, reinforcing the state's commitment to enhancing home ownership opportunities. By funding tax credits under this initiative, the state is likely to experience increased housing developments, particularly in urban areas where rental occupancy is high. This could also lead to a reduction in available rental housing, which may raise concerns about affordability for lower-income families who rely on rental options.
Summary
Senate Bill 118, introduced by Senator Schuring, aims to stimulate home ownership in Ohio by providing a nonrefundable, transferable income tax credit for the construction of new single-family homes and the conversion of rental properties into owner-occupied homes. Specifically, the bill allows qualifying taxpayers to claim a credit equal to the lesser of $50,000 or 50% of the renovation costs for these properties. The bill is likely to appeal to both builders and potential homeowners by incentivizing both new builds and the transformation of existing rental properties into homes that families can occupy and call their own.
Contention
While the intent of SB 118 is to bolster home ownership, it has drawn attention regarding potential effects on local housing markets. Critics may express concerns that converting rental properties to owner-occupied homes could limit the availability of affordable housing for low-income individuals and families. Furthermore, local governments may need to balance the implementation of these tax credits against their existing housing strategies, leading to discussions about regulation and resource allocation in the municipal sector.