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I think this is in the right direction, but the cut off at $1M is interesting. Why's there an obsession with the $1m cutoff? The dollar has been turned to dus

I think this is in the right direction, but the cut off at $1M is interesting. Why's there an obsession with the $1m cutoff? The dollar has been turned to dust. $1M is not that much money, especially in housing, especially in NYC. Why tax $1m second homes and not second homes generally? Effectively, you're going to tax almost all second homes. So why the arbitrary cutoff? Chicago wanted to add a "millionaire's tax" on $1m+ home sales. At least in Chicago, that isn't effectively taxing the vast majority of housing (and total value) - so there's some distinction worth having.

happytoexplain 5mo ago
Below 1M in NYC it becomes unclear why you have a second home. Maybe you're not quite "wealthy" and it's really helping your family out in some way. No reason to complicate things, the cutoff actually simplifies it while sacrificing almost nothing in terms of what the tax is trying to accomplish.
davidguetta 5mo ago
It's symbolic for it's demographic voters
- dominotw 5mo ago
  what does it symbolize?
  - nemomarx 5mo ago
    "going after the rich", yeah? millionaire is still generally understood as an economic class by voters.
DocTomoe 5mo ago
1 million remains the hallmark of 'wealthy' (as in: not us), to the point where pop culture has started mocking the concept decades ago (See: That Austin Powers movie...) Hardly everyone understands 'owning a house' as millionaire-level wealth. Which is why people cheer the policy on until they realize it is them who is being shaken down.
- dbalatero 5mo ago
  Sure, but it's only a shakedown if it's an unoccupied second home, which is hard to have sympathy for. It can easily be an occupied second home (family, renters) or a first home for those in the upper middle class paying for $1mm+ apartments in NYC. I'm not really worried about Jeff Bezos or some Hollywood actor's crash pad when they have business in nyc.
- sunshowers 5mo ago
  In what world is 1 million US not wealthy? Have tech salaries distorted people's opinions that much? Owning a house where your equity in it is over a million is absolutely wealthy.
  - newaccountman2 5mo ago
    > In what world is 1 million US not wealthy? In the US itself (?) lol I disagree with the comment and entire existence of the person to whom you are replying, but they aren't wrong about $1m actually not being as big or watershed a number as it used to be. A basic middle-class house in just about any part of the country that's worth living in is going to be $1m, plus or minus 200k.
    - happytoexplain 5mo ago
      "that's worth living" is doing some Herculean lifting there. I'm sorry to inform you that only the wealthy can live in the places you deem "worth living". You are not using the phrase "middle-class" correctly. I'm not coming at this from a rural perspective. I live in the greater NYC area. I have friends in NYC. They make a lot of money and live very close to Grand Central, and even they don't live in $1M properties.
      - newaccountman2 5mo ago
        I will generally concede to you, sure lol I have lived in both NYC and Southern California, and I was mostly thinking about SoCal, where in general one assumes a basic middle-class house in a reasonably decent area is going to cost $1m. Do they always? Not necessarily, but even fairly modest houses like my parents house now exceed $1m in value easily. Out of curiosity, do your friends own condos? Doesn't even a studio condo on the UES cost at least like $600k base (i.e. not counting any fees related to the sale, nor any ongoing HOA)?
sunshowers 5mo ago
Read the fine article? > While the tax seems large, experts say the city’s antiquated assessment and valuation system dramatically undervalues properties, reducing the burden. City valuations can often be 10% or less of the true market value, they said.
jimbob45 5mo ago
I agree and I’d prefer to see apartments excluded from this. Apartments are what I want second-homeowners to own rather than hoarding valuable land.
- kevin_thibedeau 5mo ago
  NYC is filled with apartments dedicated to the wealthy with token poor-doors for access to a few mandatory low income units in each building. All housing has to be subject to taxation for this to work.
- craftkiller 5mo ago
  Wouldn't excluding apartments therefore exclude Ken Griffin's 238 million dollar penthouse? That seems like exactly the kind of 2nd home that this should be targeting.
  - jimbob45 5mo ago
    Yeah I hear you but I want to incentivize dense housing like that. If you live in Texas or Florida, it’s easy to see how second homes can entirely overtake acres and acres of land.
- closetohome 5mo ago
  > The bill exempts the following categories: > The primary residence of at least one owner. > The primary residence of a parent or child of at least one owner. > Cooperative and condominium units that are appraised at less than $5 million in the previous three years. > Properties and dwelling units that are rented to a NYC primary resident. (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...)
dml2135 5mo ago
As TFA states, in NYC the assessed value of a home and the market value of a home are wildly different, with the assessed value being much, much lower. This is $1mil in assessed value which would translate to roughly $5mil in market value. In NYC $1mil market value is pretty much the starting price for a 1-bedroom condo in a gentrified area. $5mil market value, on the other hand, is a pretty luxurious place.
Jblx2 5mo ago
>Why's there an obsession with the $1m cutoff? I think this is because the term "millionaire" is a catchy term. And that caught on in the 1800s.
retired 5mo ago
The Netherlands has a 2.2% tax on secondary properties with a €50k threshold (total wealth, not per-property). So any holiday home, shed, storage locker, garage space, parking spot, bungalow, pied-a-terre, apartment for your children falls under that tax. It's.... problematic to say the least. Say you bought a bungalow for €30k in the 2000s that you frequently visit to escape the city. You are a middle class worker, it's paid off and monthly costs are minimal. It is now worth €350k. You need to pay €7700 a year. Most people don't have that type of money so they are forced to sell.
- BrenBarn 5mo ago
  That sounds like it would be pretty reasonable if the threshold were higher.
- nemomarx 5mo ago
  That's a pretty low threshold, but isn't the goal of the tax to make you sell the bungalow so someone can live in it? This seems like a policy working as intended if it's really worth 350k
  - retired 5mo ago
    Due to zoning (not sure how that translates) nobody can live permanently in the bungalow. It is only for recreational use. Has to do with infrastructure, power delivery, sewage, building standards. If it was allowed to live in that bungalow it would be worth double that.

happytoexplain 5mo ago

Below 1M in NYC it becomes unclear why you have a second home. Maybe you're not quite "wealthy" and it's really helping your family out in some way. No reason to complicate things, the cutoff actually simplifies it while sacrificing almost nothing in terms of what the tax is trying to accomplish.

davidguetta 5mo ago

It's symbolic for it's demographic voters

dominotw 5mo ago
what does it symbolize?
- nemomarx 5mo ago
  "going after the rich", yeah? millionaire is still generally understood as an economic class by voters.

DocTomoe 5mo ago

1 million remains the hallmark of 'wealthy' (as in: not us), to the point where pop culture has started mocking the concept decades ago (See: That Austin Powers movie...) Hardly everyone understands 'owning a house' as millionaire-level wealth. Which is why people cheer the policy on until they realize it is them who is being shaken down.

dbalatero 5mo ago
Sure, but it's only a shakedown if it's an unoccupied second home, which is hard to have sympathy for. It can easily be an occupied second home (family, renters) or a first home for those in the upper middle class paying for $1mm+ apartments in NYC. I'm not really worried about Jeff Bezos or some Hollywood actor's crash pad when they have business in nyc.
sunshowers 5mo ago
In what world is 1 million US not wealthy? Have tech salaries distorted people's opinions that much? Owning a house where your equity in it is over a million is absolutely wealthy.
- newaccountman2 5mo ago
  > In what world is 1 million US not wealthy? In the US itself (?) lol I disagree with the comment and entire existence of the person to whom you are replying, but they aren't wrong about $1m actually not being as big or watershed a number as it used to be. A basic middle-class house in just about any part of the country that's worth living in is going to be $1m, plus or minus 200k.
  - happytoexplain 5mo ago
    "that's worth living" is doing some Herculean lifting there. I'm sorry to inform you that only the wealthy can live in the places you deem "worth living". You are not using the phrase "middle-class" correctly. I'm not coming at this from a rural perspective. I live in the greater NYC area. I have friends in NYC. They make a lot of money and live very close to Grand Central, and even they don't live in $1M properties.
    - newaccountman2 5mo ago
      I will generally concede to you, sure lol I have lived in both NYC and Southern California, and I was mostly thinking about SoCal, where in general one assumes a basic middle-class house in a reasonably decent area is going to cost $1m. Do they always? Not necessarily, but even fairly modest houses like my parents house now exceed $1m in value easily. Out of curiosity, do your friends own condos? Doesn't even a studio condo on the UES cost at least like $600k base (i.e. not counting any fees related to the sale, nor any ongoing HOA)?

sunshowers 5mo ago

Read the fine article? > While the tax seems large, experts say the city’s antiquated assessment and valuation system dramatically undervalues properties, reducing the burden. City valuations can often be 10% or less of the true market value, they said.

jimbob45 5mo ago

I agree and I’d prefer to see apartments excluded from this. Apartments are what I want second-homeowners to own rather than hoarding valuable land.

kevin_thibedeau 5mo ago
NYC is filled with apartments dedicated to the wealthy with token poor-doors for access to a few mandatory low income units in each building. All housing has to be subject to taxation for this to work.
craftkiller 5mo ago
Wouldn't excluding apartments therefore exclude Ken Griffin's 238 million dollar penthouse? That seems like exactly the kind of 2nd home that this should be targeting.
- jimbob45 5mo ago
  Yeah I hear you but I want to incentivize dense housing like that. If you live in Texas or Florida, it’s easy to see how second homes can entirely overtake acres and acres of land.
closetohome 5mo ago
> The bill exempts the following categories: > The primary residence of at least one owner. > The primary residence of a parent or child of at least one owner. > Cooperative and condominium units that are appraised at less than $5 million in the previous three years. > Properties and dwelling units that are rented to a NYC primary resident. (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...)

dml2135 5mo ago

As TFA states, in NYC the assessed value of a home and the market value of a home are wildly different, with the assessed value being much, much lower. This is $1mil in assessed value which would translate to roughly $5mil in market value. In NYC $1mil market value is pretty much the starting price for a 1-bedroom condo in a gentrified area. $5mil market value, on the other hand, is a pretty luxurious place.

Jblx2 5mo ago

>Why's there an obsession with the $1m cutoff? I think this is because the term "millionaire" is a catchy term. And that caught on in the 1800s.

retired 5mo ago

The Netherlands has a 2.2% tax on secondary properties with a €50k threshold (total wealth, not per-property). So any holiday home, shed, storage locker, garage space, parking spot, bungalow, pied-a-terre, apartment for your children falls under that tax. It's.... problematic to say the least. Say you bought a bungalow for €30k in the 2000s that you frequently visit to escape the city. You are a middle class worker, it's paid off and monthly costs are minimal. It is now worth €350k. You need to pay €7700 a year. Most people don't have that type of money so they are forced to sell.

BrenBarn 5mo ago
That sounds like it would be pretty reasonable if the threshold were higher.
nemomarx 5mo ago
That's a pretty low threshold, but isn't the goal of the tax to make you sell the bungalow so someone can live in it? This seems like a policy working as intended if it's really worth 350k
- retired 5mo ago
  Due to zoning (not sure how that translates) nobody can live permanently in the bungalow. It is only for recreational use. Has to do with infrastructure, power delivery, sewage, building standards. If it was allowed to live in that bungalow it would be worth double that.