Property Tax. Work in Progress in New York
Kathy Hochul, the governor of New York State, presented a temporary plan to tax co‑op and condo units that will remain in effect until the city develops a new property valuation system.
Bloomberg, citing sources familiar with the matter, claims that Hochul is negotiating with state legislators on a budget of US$268 billion.
Its adoption is already expected to be delayed by six weeks.
The press agency emphasizes that the plan to introduce a property tax in New York has encountered some difficulties, but if the process succeeds it could generate even US$500 million in revenue.
“Over the next two years, housing cooperatives and homeowner associations will be taxed based on market value, a figure set by the Department of Finance that may differ significantly from the sale price,” Bloomberg says.
“For example, Ken Griffin’s penthouse at 220 Central Park South, which he purchased for US$238 million, has a market value of US$14.9 million according to city tax records,” the article added.
Hochul announced that New York properties with a market value of $1–3 million will be taxed at 4%; those valued at $3–5 million at 5.25%; and those worth $5 million or more at an additional rate of 6.5%.
“The governor’s office estimates that US$1 million in market value equals US$5 million in sale price. Single‑family homes above $5 million will be taxed based on the determined market value, a different metric that more accurately reflects the actual property price,” the report said.
“Properties up to $15 million will incur an additional fee of 0.8%. Those valued at $15–25 million will be taxed at 1.05%, and properties worth $25 million and above at 1.3%. All these fees are added to existing property taxes,” the article added.
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Mamdani’s Campaign Promises in Focus
New York City Mayor Zohran Mamdani consistently pursues the promises in his campaign platform, including a “pied‑a‑terre tax,” a tax on secondary residences and homes that are not the owners’ primary residence.
Initial estimates suggest that each year the new fee would cover about 13,000 properties and apply to residences valued at over $5 million.
Recent information indicates that even cheaper apartments would not be exempt from the tax, which, according to officials, will increase housing availability in the market and improve services for residents from less affluent groups.
On Thursday, New York authorities announced a plan to introduce a cash‑transaction property tax on residential real estate worth at least $1 million in the city.
Both Mamdani and Hochul stress that their goal is to eliminate social inequalities arising from many properties being bought by billionaires, often unused as their main homes.
“These are the kinds of transactions that happen in this city, houses that remain empty for most of the year, and all of this happens while New Yorkers struggle with difficulties in the same city,” Mamdani said.
More on this was covered in the article: Property tax returns! Flippers and the wealthiest multi‑unit owners will pay dearly for luxury.
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Source: Bloomberg.
