The New York State legislature has approved Gov. Kathy Hochul’s proposal to enact a new tax on second homes in New York City valued at $5 million or more.
The Wall Street Journal reports the so-called “pied-à-terre tax” is part of the state’s budget legislation and will go into effect on July 1. Hochul claimed the new tax could generate as much as $500 million per year for the cash-strapped city, which is operating on a $5.4 billion deficit.
The city’s Department of Finance will determine if a residence is a second home and would then calculate its market value. Hochul estimated that 10,000 homes belonging to non-residents of the city would be subject to the tax.
The tax became the subject of controversy when New York City Mayor Zohran Mamdani recorded an online video that singled out hedge fund executive Ken Griffin’s penthouse property as an example of the tax’s target. Griffin paid a record-breaking 2019 for the penthouse in 2019 and could owe $1 million or more with the new tax.
3 Things are certain here:
#1…The tax will not come close to generating what they estimate
#2…The tax will decrease real estate values thereby decreaseing property tax revenues
#3…Everyone who can relocate will do so. Money can move and will do so when unfairly burdened.
Bad idea from small thinkers who couldn’t EARN a dollar if they had to.
They are not trying to save NY, they are dismantling what was the capital city of the world. It’s the same thing they were trying to do to our country before Trump got elected, both times! When will we quit living in denial and take them for their word?
Take a lesson from California. You unfairly tax businesses and homes and people and businesses will go to another state. There goes your tax dollars. Your only making things worse!
This is what happens when the liberal idiots out number people with common sense. Sadly, to people that voted for him may not even be affected by the insanity his has brought to New York. He is going to bring New York down!!!
Good move for the state.
It’s a beginning!
Daniel you are correct in your analysis. Virginia, I am assuming you live in another state and are happy because this regressive tax will be sending people to other states that want to attract talent and businesses.
Born and raised in upstate NY. Very fortunate I was able too and did leave many years ago. So sad for family and friends who are still there. “New York is a great place to be from”
It’s an updated version of blockbusting…
Intended to create a hardship on current owners to free-up inventory for a preferred/targeted group of buyers…
In New York lobbyists are using excessive taxation…
In Arizona, they’re using a version of AZ HB 2429…
Without a restrictive HOA, local longstanding R-43 zoning has been struck down and STR’s have moved into exclusively residential, luxury single family home neighborhoods where STR’s have been prohibited for decades.
Today, AZ residents (who paid a premium to live in a residentially zoned community) must either live with the noise, & traffic of public, commercial use of neighboring homes or move.
Whatever the location, selling under adverse conditions means appealing to a limited buyer pool and leaves sellers vulnerable to lower offers than comparable homes without the nuisance/risks of proliferating nonconforming use or punitive taxation.
The only beneficiaries of these tactics are the lobbyists and their clients who
opportunistically sweep in to buy at bargain prices.
As FDR said years ago when he wanted and did tax rich people a little more, “some of my best friends say they are going to leave the country & I for one, wish them well” If you own a 5 million dollar second home in NYC, you are not leaving to go elsewhere. That is a Republican myth!!!!! Sort of like trickle down economics. Utter nonsense!!!!!
As FDR said years ago when he wanted and did tax rich people a little more, “some of my best friends say they are going to leave the country & I for one, wish them well” If you own a 5 million dollar second home in NYC, you are not leaving to go elsewhere. That is a Republican myth!!!!! Sort of like trickle down economics. Utter nonsense!!!!!