12 ms·
New York to tax luxury second homes in NYC
- mikeweiss 5mo agoGood! Second homes in any region with low inventory should be taxed...
- nxk 5mo agoYup
- ch4s3 5mo agoIt seems like a place like Manhattan might benefit from first up-zoning the low slung sections that are currently 4-8 stories. My point here is that I'd start with trying to build enough housing before spending political capital on marginal things that neither unlock supply nor generate much revenue.
- Daishiman 5mo agoIn Manhattan the low zones are due to the soil not being good for higher construction. Lower Manhattan and midtown are made of basalt stone that is extremely strong and apt for skyscrapers.
- ch4s3 5mo agoBedrock is only a little lower in the "Midtown Gap", and in any case a lot of those 4 story buildings could be 8-10.
- organsnyder 5mo agoI'm guessing it would be tough to make the numbers work demolishing a 4-story building and building one that's only 2-2.5x the square footage, especially with today's interest rates.
- ch4s3 5mo agoThat's pretty hard to say in a blanket way, I wouldn't want to speculate. But there's never a bad time to fix zoning.
- cucumber3732842 5mo agoYou'll lose a ton of square footage to compliance. Those wide doorways with non conflicting doors, wide staircases, required clearances around everything, all the other stuff that's been done to old apartments that isn't compatible with modern codes. So that 2.5x square footage is more like 1.5x when it comes to the number of units of like quality/liveability you can pack in.
- bobthepanda 5mo agothe real reason midtown is where it is, is because that is where the train stations are due to the city banning surface running railways south of 42nd St. (The remaining surface railways north of that point have been covered up.) As a result, Midtown is now one of the few places in New York's metropolitan that can reach the millions of people in the five boroughs and the suburbs all at once, which means the labor market is substantially larger than what it is in Lower Manhattan or Downtown Brooklyn, and makes it massively more attractive for employers.
- nickv 5mo agoYou're right, when I think of a place that has an overabundance of 2 floor single family homes, I think of Manhattan.
- ch4s3 5mo agoYou'll notice I specifically said 4 to 8 story buildings.
- asdff 5mo agoIt isn't that which is the issue. It is the fact greenwich village has been at the same height since even before Don Draper's time. You see, the suburban enclaves of long island and upstate and new jersey and the comparatively more built up areas of manhattan do have the exact same issue with regards to housing, and that is there is little room in the zoned capacity to legally add any more housing. In 1961, NYC adopted a zoning plan that saw zoned capacity reduced by 80%. These sort of changes to zoning happened around the country in the 1960s and 70s in response to red lining being made illegal. If you can't prevent black people from living near you by law, maybe you could instead prevent anyone from living near you and guarantee a supply side crisis such that the wealthiest individuals in the economy are who can afford to be your neighbors, and in 1961 surely they won't be black. You should look up the median income differences between a white nycer and a black nycer today, it is shocking. Median household wealth for whites just within the scope of new york state, not even at city resolution, is nearly 15x higher (1). Today, 80 years later, we have kept the racist-by-transitive-property laws on the books all over the country. And as such, cities remain highly segregated by both race and class. Civil right era in terms of housing was essentially a failure to achieve any change from this status quo. 1. https://comptroller.nyc.gov/reports/the-racial-wealth-gap-in-new-york/ https://comptroller.nyc.gov/reports/the-racial-wealth-gap-in...
- bobthepanda 5mo agoWith historic landmarks or districts you can generally transfer unused development capacity to other sites. Grand Central famously was spared from demolition but its unused zoning rights have been transferred elsewhere.
- deleted 5mo ago[deleted]
- cyberax 5mo agoLOL. Why not just build bunkhouses and then rent out bunk beds there? For a cool $5000 a month. Because that's the end goal, isn't it? Manhattan is _already_ one of the densest cities in the world. It needs a good _downzoning_ to be liveable again.
- bombcar 5mo agoIf everyone who wants to pay $5k a month to live in NYC is able to; I’ll be super happy and pleased for them.
- javanissen 5mo ago> bunk beds… $5000/month The market prices full one-bedrooms at less than this in most of Manhattan. Flophouse beds would cost a fraction of this and they would get cheaper the more of them you have. They’d also slow the growth of rent price in NYC. Let’s take your example at face value. Suppose Manhattan added one million beds to its existing ~3.8M bedroom housing stock via the “missing middle” housing that you described, perhaps over the next ten years. These might have small private bedrooms and shared kitchen/office/bathroom facilities. They might even include dorms, but I’ll focus on single-room occupancy units. You’d get the space for this from some mix of re-developing office buildings or upzoning or re-developing low-slung buildings. The rent of these single-room occupancy units would be a fraction of the rent of a normal place. The people living there would be far less rent-burdened than they would have been otherwise, freeing up more income for consumption or savings/investment, boosting economic activity. Some of them would be new residents, whose income taxes (if they pay them) and spent dollars/sales taxes would be a net benefit to the city budget. Some of them would otherwise become transiently homeless due to affordability concerns, which would be destabilizing for them and expensive for the city due to homeless program spending. Others would be people who currently live in apartments but would move to these units because they prefer cheaper rent, greater privacy (they might be sharing a room today), a newer building, or the greater efficiency of having multiple bathrooms. Maybe right now they are sharing e.g. a four-bedroom one-bathroom apartment with three strangers in Hell’s Kitchen for $1400/month. These people would otherwise be in the housing market for a full apartment, and removing them leaves more full apartments for people who want to occupy them, either alone or with roommates. Ergo we get downward pressure on full apartment rents. The flophouses and dorms and SROs were a key part of the housing market that kept Manhattan more affordable and therefore livable in the 20th century, when density was up to 40% greater than it is now. It was deeply shortsighted to get rid of them. The idea that we should downzone even further makes no sense to me; you get to decrease affordability and decrease the economic benefits of agglomeration to the local economy at the same time, all so… there are fewer people on the subway, I guess? I disagree with the “too much density” argument on its face anyway. Density has clear economic benefits via agglomeration and productivity gains; diverse and dense housing stock via upzoning increases affordability via supply/demand and filtering effects; and the way you manage density is through appropriate infrastructure spending on housing, services, and public spaces which—you guessed it!-becomes cheaper per person the denser you build. Seoul has twice the density of Manhattan. I live here. The thing making Manhattan unlivable is that a one-bedroom is $4500 in the east village due to not enough supply. Fix the housing costs by building more of any and all kinds of housing and then we can deal with the other problems via better governance and increased tax revenues. There’s nothing we can do otherwise that isn’t just rationing or some other bandaid solution.
- stvltvs 5mo agoIs increasing housing the goal of the tax, or is it just raising revenues to balance the budget?
- bdangubic 5mo agoboth
- bjourne 5mo agoHow do you know it's ineffective? Other targeted taxes, such as alcohol tax, tobacco tax, congestion tax, etc., have been shown to be very effective.
- sylos 5mo agoThe power to tax is the power to destroy
- throwaway27448 5mo agoWhy not both? To suggest otherwise is absurd. If I might put my tinfoil hat on for a moment, I think the recent obsession with upzoning is to distract from the possibility of regulating landlords—as if there were any large number of people opposed to upzoning before....
- bityard 5mo agoIf someone tried to "up-zone," wouldn't they incur enormous popular and media backlash for demolishing buildings and displacing communities that have been there for decades just so they could build high-rent luxury skyscrapers? I feel like that was the backdrop to about half the movies I watched in the '80s.
- ch4s3 5mo agoThen star with Greenwich Village.
- 8note 5mo agoi think upzoning which requires kicking people out of the homes they currently live in is spending more political capital than changing tax policy to get more utilization out of the existing empty houses. The people that have second luxury homes in new york are the people that spent through the roof to avoid mamdani being elected
- al_borland 5mo agoIf I was a developer and building owner who only cared about money, it seems like it would be much better to build a luxury building where the units are sold, but sit empty most of the time. This seems to be the environment in NYC. The proper systems need to be in place so it makes sense to build housing for actual people, rather than building stored real estate value for the ultra rich, especially foreign investors who may never even set foot in the US and are just looking to diversify their portfolio. I’m not an “eat the rich” person, but these mostly vacant buildings in a city with a housing affordability problem are a crime. I don’t necessarily fault the billionaires for this, I fault the politicians who sat back and watched it happen, approving all the projects along the way.
- javanissen 5mo ago> these mostly vacant buildings in a city with a housing affordability problem Vacancy rates are extremely low in NYC at 1.4%. Anything below 5% indicates drastic under-supply of housing. I don’t think that vacant real estate for billionaires is a significant contributor; it’s almost exclusively an issue of supply.
- lux-lux-lux 5mo agoThat percentage only includes the openly listed units; NYC has a massive shadow inventory of rentable inventory deliberately kept off-market for various reasons. 1 Wall St, for example, kept 85% of its units arbitrarily off market in order to prop up rents, and thus imputed property valuation. This kind of behavior shouldn’t be encouraged by the state and financial system, but guess what we do!
- dgellow 5mo agoSpending political capital? Mamdani is gaining political capital with such taxes!
- dlenski 5mo agoWe have similar taxes in major cities in Canada (including both metro and provincial taxes here in Vancouver). Housing is still massively squeezed and unaffordable for many in the Vancouver metro area, but the taxes definitely have encouraged some homeowners to sell or rent their properties, especially foreign investors, and their seem to be few or no downsides for people of middle-class and even moderately-affluent incomes. I doubt that NYC will lose too much sleep over the protestations from extraordinarily wealthy people who own multiple extraordinarily expensive homes, and where NYC isn't their primary residence.
- dlenski 5mo ago"there seem", not *their seem… argh, embarrassingly uneditable
- temp8830 5mo agoAll the owners have to do is transfer the property to an LLC. I'm sure none of them will figure this out. This proposal's only purpose is PR.
- dgellow 5mo agoWhich isn’t a bad thing per se. A lot of politics is about messaging, there is value in formalizing a position such as this one
- busterarm 5mo agoI strongly doubt that this is going to have the effect that they want it to. It won't raise the taxes that they expect it to. It won't free up inventory. It will halt construction.
- bix6 5mo agoIt’ll halt construction on luxury second homes? Wonderful!
- NickC25 5mo agoSeriously. Instead of using that land to build a $250 million penthouse Ken Griffin only spends 10 days a year in, they could probably build enough housing for 500+ middle class families.
- Mallory_Ringess 5mo agoWho will build those homes? Who will pay for them? If it were a lucrative business to build those homes I'd assume someone would be building them but that does not seem to be the case. Why is this?
- bix6 5mo agoUpvoting you for a great question! Not everything has to be lucrative amigo. The city could build multifamily housing and finance it through municipal bonds that pay a reasonable rate (tax free, booyakasha).
- deleted 5mo ago[deleted]
- cybercatgurrl 5mo agohey better to keep new homes out of the rich than to have new homes at all! it’s still a win
- 5mo ago
- dvngnt_ 5mo agoZohran is doing too much. I hope he at least leaves the second yachts alone.
- onlyrealcuzzo 5mo ago[flagged]
- mynameajeff 5mo ago[flagged]
- saulpw 5mo agohttps://fortune.com/2026/05/16/new-york-private-jet-tax-mamdani-teterboro-port-authority-elevate-aviation/ https://fortune.com/2026/05/16/new-york-private-jet-tax-mamd...
- stavros 5mo agoWhat's the context here? Isn't he doing enough?
- bestouff 5mo agoIt's sarcasm (and I enjoyed it).
- stavros 5mo agoYes, and I'm asking what the context for that sarcasm is.
- bobthepanda 5mo agothe political and financial elite of New York are coming to terms with the fact that they have completely lost the faith of the lower and middle classes in terms of maintaining or improving living standards. it has been interesting watching the media try to contort themselves to address this. The WSJ somehow managed to best the infamous "avocado toast" line about saving for a house by suggesting that current youngsters are splurging on rotisserie chicken: https://www.yahoo.com/entertainment/articles/wall-street-journal-shared-theory-211512999.html https://www.yahoo.com/entertainment/articles/wall-street-jou...
- jmclnx 5mo ago> an initiative to appease Mayor Zohran Mamdani and liberal voters Taxing the rich is not a Liberal thing, but the Rich is calling it that because they do not want to pay any taxes at all. He was elected because people are starting to feel real pain and seeing the ultra rich paying far less taxes then they are. If it was up to me, I would tax all the second homes above 5 million USD and add a Luxury Tax on all valuable Autos too.
- busterarm 5mo agoThe top 1% of NYC residents contribute 40-48% of all personal income tax collected in NYC. When you extend that to Top 2.5% you cross 51%. Personal Income Tax accounts for around 31% of collected NYC tax revenue. "The rich" also pay property tax. NYC's poorer residents generally don't have property to pay tax on. Everyone pays sales tax equally. So how exactly are the ultra rich paying "less taxes"?
- 2OEH8eoCRo0 5mo agoVoters don't feel like it's a fair deal. Telling voters that their concerns aren't real is a losing strategy.
- busterarm 5mo agoIf you live in New York you rolled at least a 15 on life's D20. That's how good of an opportunity that location is. I started and lived most of my life there and started in poverty -- for there. That's still a better opportunity than most people ever get. All these people pointing at the nat 20s losing their minds screaming like they rolled 1s.
- jjav 5mo agoSurely you know this, but the rich are paying less percentage taxes relative to the money they have.
- busterarm 5mo ago
- bix6 5mo agoCalifornia next please! If you aren’t in your home 9 months of the year you can stay in a hotel. Thanks! Edit: lol -4 nice! What are y’all upset about?
- ecliptik 5mo agoNot all of California, but San Diego has Measure A[1] on the upcoming primary to tax non-primary homes. 1. https://www.kpbs.org/news/politics/2026/04/20/2026-primary-election-measure-a-non-primary-homes-tax-empty-homes https://www.kpbs.org/news/politics/2026/04/20/2026-primary-e...
- bix6 5mo agoLet’s go baby!! We love a vibrant local community.
- cybercatgurrl 5mo agoguarantee you those people that are salty are not in your tax bracket
- tlogan 5mo agoI assume this will be challenged in court immediately. Does anyone understand whether it is likely to survive those legal challenges? EDIT: Here is a list reported by Google search but I really do not understand or know how reasonable these challenges are. Equal Protection: Owners may argue the tax unfairly treats similar properties differently based on second-home status, value threshold, or owner residence. This is likely a weaker challenge because tax classifications usually receive deferential rational-basis review. Nonresident Discrimination: A challenge could claim the tax targets out-of-city, out-of-state, or foreign owners rather than property use. The law is safer if written as a tax on non-primary luxury residences, not on nonresidents as a class. Assessment Inequality: Owners may challenge how the city values condos, co-ops, townhouses, and mixed-use properties. This could be significant if the $5 million threshold is applied inconsistently or without reliable valuation rules. Due Process: Owners may argue the law lacks clear notice, proof, exemption, and appeal procedures. This would be especially relevant for disputes over whether a home is truly a second home. Residency Conflicts: Taxpayers may challenge inconsistent treatment if the city treats them as NYC residents for income tax but non-primary homeowners for this tax. Clear coordination between residency rules would reduce this risk. Home Rule Authority: Opponents may argue NYC lacks authority unless the state clearly authorizes the tax. This challenge is less likely to succeed if Albany passes valid enabling legislation and NYC follows required procedures.
- zaphod12 5mo agoNYS already has tax breaks for one's primary residence which varies by income and a tax on the sale of homes >$1Mil. Given how entrenched those are, I have trouble imagining a way in which this new tax is incongruous with existing rules.
- citadel_melon 5mo agoProperty taxes already exist. There is no obvious reason why this particular property tax would be legally problematic. The tax is also likely politically difficult to counter. Consider how limited in scope these taxes are, how the tax revenue benefits residents who live in NYC through providing more revenue for services without taxing residents at all, and how the only constituent the taxes negatively affects are non-residents (aka it’s non-trivial to argue that these people should even be considered constituents) who benefit from the services the city offers through stable apartment prices that nicely store their wealth yet provide little value in return. The only rebuttal one could conceive is the value these high-net-worth individuals altruistically provide the city through developing office space and giving jobs to the city is not worth risking, but that is like saying the tail wags the dog. The reason these CEOs go to NYC is because that is where the talent and economic clustering is: if these high-net-worth individuals could get the talent they need to run their firms in Miami and Austin, they would have done so already. They have tried and they have failed up until this point. Regardless, a claim into the future in such a complex system such as the markets and the judicial system (especially a common law system) always relies on induction which is never going to be deterministic. However, this tax is just another property tax meaning it likely will stand in court. Additionally, given that the opposition has very weak rebuttals against a well-versed counterparty implies the legislature or other political machinery won’t have a strong enough incentive to fight this tax.
- tekla 5mo agoI dunno why anyone thinks this matters. https://comptroller.nyc.gov/reports/the-pied-a-terre-tax-and-its-potential-revenues/ https://comptroller.nyc.gov/reports/the-pied-a-terre-tax-and... "We find that, before adjusting for these factors, our choice of tax rates and brackets could raise almost exactly $500 million from a little over 11,200 properties. However, revenues could be reduced to between roughly $340 million and $380 million based on assumptions on exclusions for rented units and behavioral changes following the imposition of the tax." It's all media feel goodsies but not actually do anything substantive.
- free_bip 5mo agoSo it'll still raise at least 300 million? Sounds like a great thing to me. I dunno why you think it doesn't matter.
- 0cf8612b2e1e 5mo agoUnlocking extra housing is the real boon, the tax revenue is the bonus.
- jonfw 5mo agoI think that this has the benefit of both raising a non trivial amount of money as well as reducing housing demand from the wealthy in a supply constrained market
- tlogan 5mo agoFrom what I know this is going to be challenged in the court and it probably it is not going to pass the legal challenge (renting part is one interesting loophole - I think that one caused similar tax law in SF to be struck down).
- dgellow 5mo agoSo, in addition to doing something very popular, meaning gaining political capital, it is ALSO expected to get hundreds of millions from this? That’s very substantial in my book
- bsimpson 5mo agoReactionary taxes like this have a tendency to be ill-considered and have unintended side effects. NY also has a 1% penalty on paying more than $1 million for housing, which was probably enacted to proletariat applause when $1 million was still considered a lot of money. Now it distorts the value of entry level housing in NYC, where you'll have a hard time finding anything more than a studio apartment for $1 million. High closing costs and similar distortions mean people tend to lose money on housing in NYC unless it's held for many years. $5 million is expensive enough that this probably won't add much housing stock in the short term. Still, politicians never seem to think through the consequences of headline-grabbing tax policies.
- braiamp 5mo agoEven in worse case scenario, which this isn't, the affected persons would at most try to cheat the system. This proposal is really narrow to non-primary residences, that are also very valuable. None of which will affect 99.999% of the population.
- saulpw 5mo agoGosh, 1% on $1m, that's almost $10k! I can see that how would discourage homeownership and distort the market. Actually wait, I can't.
- wan23 5mo agoYou're comparing the wrong numbers. The question is what 1% of the purchase price does to the amount you need for your down payment and fees. On a 10% down payment an extra 1% increases the amount you need by 10%. Remember that while a million dollar home sounds extravagant, it's first time buyers who often have just barely enough who are trying to buy these.
- rootusrootus 5mo ago> On a 10% down payment an extra 1% increases the amount you need by 10% Because you are not allowed to roll that tax into the loan?
- AdrianB1 5mo ago[flagged]
- trolleski 5mo agoTax them to oblivion, the goal should be for them to sell! Let them go to Dubai if they don't like it.
- hackeraccount 5mo agoThey'll go to Florida.
- Mallory_Ringess 5mo agoBefore long Mamdani will provide yet another proof of Thatcher's well-known dictum on socialism: The problem with socialism is that you eventually run out of other peoples' money
- trolleski 5mo agoTaxes are not socialism.
- Mallory_Ringess 5mo ago...bub Mamdani is a socialist and he will run into these problems.
- verteu 5mo agoOne way to avoid the tax is to rent out the residence: https://comptroller.nyc.gov/reports/the-pied-a-terre-tax-and-its-potential-revenues/ https://comptroller.nyc.gov/reports/the-pied-a-terre-tax-and... It's interesting that people choose to leave their properties vacant - They're effectively "taxing" themselves by foregoing rent (4+%/yr cap rate). Is vacant real estate even a good investment?
- javanissen 5mo agoNo, which is why there are very few vacant units in NYC: 1.4%-ish percent of total supply, whereas the rule of thumb I've heard is that around 5% is the sign of a reasonable equilibrium. (In a well-functioning real estate market there are some units offline due to vacancy, turnover, and renovation, so we don't expect 0%. High vacancies of e.g. 10% suggest insufficient demand for the supply.)
- NordStreamYacht 5mo agoIf I was a rich dude in nyc I would set up a shell company, transfer ownership to that, and then rent it back from the shell.
- gaadd33 5mo agoSo then the rich guy is an NYC resident and pays taxes there, that's a great outcome for the city.
- NordStreamYacht 5mo agoHuh. That's disappointing.
- m463 5mo agoI was wondering about trusts. people put houses in family trusts.
- deleted 5mo ago[deleted]
- everybodyknows 5mo agoHow does enforcement work? The article does not say.