When 2008 rolls around, HR 3648, a bill making its way through Congress, will limit investors exemption on "primary residences" ..... this is to say houses that are second homes and claimed as their primary residences.

Under current laws, if an investor lives in a residence for 2 of 5 years they are eligible for a full tax exemption: $ 250 000 for a single person, and $ 500 000 for married people. If HR 3648 passes, it will pro-rate the tax exemption for time an owner lives in a primary residence. Hence, an investor who lives in one of his houses for 2 years over a 5 year period will only be eligible for 40% of the full tax exemption.