12 markets hit hardest by slashing the mortgage deduction
It's not just high-cost markets in California that would get squeezed by House Republicans' proposed $500,000 cap on the mortgage interest deduction.

Housing markets across cities in Louisiana, Nevada and Washington also have a significant percentage of loans over this threshold.

And in an ironic twist, the housing market in the Washington, D.C., metro area, where many U.S. government workers and elected officials live, would also be affected by the proposed limit.

Through the end of October, 5.4% of all mortgages closed nationwide (purchase and refinance) had a balance of over $500,000 at origination, according to Attom Data Solutions.

On a state level, Hawaii had the largest percentage of year-to-date 2017 originations over $500,000 at 15.1%, followed by California at 11.5% and Delaware at 9.3%.

It's not just the wealthy that take the mortgage interest deduction. Nearly 33.6 million taxpayers deducted $72.4 billion in mortgage interest from their 2014 taxes, and that figure could rise to as much as $96.4 billion by 2019, according to estimates from the Congressional Joint Committee on Taxation. Approximately 28 million filers — 83% — that claimed the home mortgage interest deduction on their tax returns in 2014 had household income under $200,000.

What's more, the GOP tax plan also calls for removing the deduction for state and local property taxes, which would further increase homeowners' tax obligation.

Here's a look at the 12 housing markets with the largest percentages of mortgages over $500,000. The data, from Attom, is based on metropolitan statistical areas with at least 2,500 closed loans in the first 10 months of the year.
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The San Diego skyline at night, seen from Centennial Park, in Coronado, California.
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No. 12: San Diego-Carlsbad, Calif.

Number of loans over $500,000: 12,739
Total closed loans: 88,934
Share of loans over $500,000: 14.3%
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Shreveport, Louisiana, USA downtown skyline on the Red River.
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No. 11: Shreveport-Bossier City, La.

Number of loans over $500,000: 916
Total closed loans: 6,298
Share of loans over $500,000: 14.5%
Santa Cruz
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No. 10: Santa Cruz-Watsonville, Calif.

Number of loans over $500,000: 910
Total closed loans: 6,045
Share of loans over $500,000: 15.1%
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No. 9: Seattle-Tacoma-Bellevue, Wash.

Number of loans over $500,000: 13,736
Total closed loans: 88,166
Share of loans over $500,000: 15.6%
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Famous "The Biggest Little City in the World" sign at night in Reno, Nevada, USA
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No. 8: Reno, Nev.

Number of loans over $500,000: 3,023
Total closed loans: 19,176
Share of loans over $500,000: 15.8%
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Aerial view of complex highway interchange in Los Angeles California.
Ron Chapple Stock/iofoto - Fotolia

No. 7: Los Angeles-Long Beach-Anaheim, Calif.

Number of loans over $500,000: 44,050
Total closed loans: 274,451
Share of loans over $500,000: 16.1%
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Ritu Jethani - stock.adobe.com

No. 6: Bridgeport-Stamford-Norwalk, Conn.

Number of loans over $500,000: 2,066
Total closed loans: 12,497
Share of loans over $500,000: 16.5%
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Traditional Renovated Brick Houses in Alexandria Old Town, Virginia
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No. 5: Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.V.

Number of loans over $500,000: 17,613
Total closed loans: 103,019
Share of loans over $500,000: 17.1%
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waikiki beach and diamond head
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No. 4: Urban Honolulu, Hawaii

Number of loans over $500,000: 3,711
Total closed loans: 20,686
Share of loans over $500,000: 17.9%
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No. 3: Summit Park, Utah

Number of loans over $500,000: 477
Total closed loans: 2,629
Share of loans over $500,000: 18.1%
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San Francisco shrouded in fog with Mt Diablo in the distance
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No. 2: San Francisco-Oakland-Hayward, Calif.

Number of loans over $500,000: 21,644
Total closed loans: 102,360
Share of loans over $500,000: 21.1%
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Stanford University Campus in Northern California with Hoover Tower in Background
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No. 1: San Jose-Sunnyvale-Santa Clara, Calif.

Number of loans over $500,000: 11,486
Total closed loans: 41,797
Share of loans over $500,000: 27.5%
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