(Bloomberg) -- Millennials looking to enter the housing market might not be cheering the Republican tax plan.
The bill's talking points, released Thursday, suggest that the interest deduction for existing home mortgages will be preserved in full, but newly purchased homes will see the cap cut in half, to $500,000.
The SPDR S&P Homebuilders exchange-traded fund, ticker XHB, and an S&P index that tracks builders plunged in early trading. If the losses hold, it would be the worst day for both in more than a year.
Luxury homebuilder Toll Brothers Inc. fell as much as 7.3 percent, and retailer Home Depot Inc. also saw heavy losses.
The tax tweak, if implemented, will acutely affect new buyers and builders in the Northeast. According to the U.S. Census Bureau, the median selling price in that region last year was $428,200 -- roughly $150,000 more than the Midwest and South, and $60,000 higher than in the West.
To contact the reporter on this story: Luke Kawa in New York at lkawa@bloomberg.net.
To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Andrew Dunn, Brendan Walsh
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