New York Proposes Pied-à-Terre Tax on Luxury Second Homes
New York Governor Kathy Hochul and Mayor Zohran Mamdani have proposed a pied-à-terre tax on luxury second homes in New York City to address budget deficits and wealth inequality. The tax targets properties valued over $1 million to $5 million, with rates up to 6.5%, aiming to generate $500 million annually. The plan has sparked tension with billionaire Ken Griffin, who threatened to relocate operations to Miami, and faces criticism from business leaders and real estate executives over potential economic fallout.
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New York's pied-à-terre tax on wealthy second-home owners goes into effect
New York State has officially enacted a pied-à-terre tax targeting ultrawealthy owners of second homes in New York City, as part of the state budget passed on May 28, 2026. The joint proposal by Governor Kathy Hochul and Mayor Zohran Mamdani imposes surcharges on properties worth over $5 million that are not primary residences. Single-family homes valued between $5 million and $15 million face a 0.8% surcharge, rising to 1.3% for properties over $25 million. Co-ops and condos currently assessed at $1 million or more will initially face higher rates (4% to 6%) until a new valuation system is developed. The tax is expected to affect about 10,000 properties and raise up to $500 million, though actual revenue may be lower. The measure is set to expire in 2031 unless renewed. Critics, including Citadel CEO Ken Griffin, have opposed the tax.
All Content from Business InsiderNew York passes Mamdani's pied-a-terre tax. Here's who pays and how much
New York state lawmakers passed a pied-a-terre tax on non-primary residences in New York City to help close the city's budget gap. The tax applies to second homes valued at $1 million or more and is expected to raise $500 million. In the first two years (2026-2028), properties valued between $1 million and $3 million face a 4% annual tax; $3-5 million face 5.25%; and over $5 million face 6.5%. Starting in 2028-2029, valuations will be based on comparable sales, with lower rates (e.g., 0.8% for $5-15 million, 1.3% for over $25 million). Billionaire Ken Griffin, who owns a $238 million penthouse, became the face of the tax after Mayor Zohran Mamdani posted a video outside his apartment. Griffin's tax bill would more than double initially and rise to nearly $4 million by 2028. Griffin has threatened to move jobs to Miami in response.
US Top News and AnalysisNew York's Luxury Second Home Tax Slated for July: New Details Revealed
New York lawmakers are finalizing a state budget that includes a pied-à-terre tax on luxury second homes, set to go into effect as early as July 1, 2026. The tax targets secondary single-family homes valued at $5 million or more, with rates ranging from 0.8% to 1.3% after an initial two-year phase. Co-ops and condos worth $1 million or more would face 4% to 6.5% taxes during the first two years. Property owners will be notified by August 30 and can contest inclusion. Exemptions apply to primary New York City residents, immediate family occupants, and rental units. The tax has sparked conflict between Mayor Zohran Mamdani and billionaire Ken Griffin, who warned it could jeopardize a $6 billion Citadel expansion. Governor Kathy Hochul supports the measure, estimating it will raise $500 million. The state legislature votes on the proposal Wednesday.
Forbes - BusinessHochul and Mamdani's New Property Taxes Risk Chaos in NYC System
New York Governor Kathy Hochul and Mayor Zohran Mamdani are proposing new taxes targeting wealthy property owners to address the city's budget shortfall. The measures include a pied-à-terre tax on luxury second homes and a potential transfer levy on cash purchases of residences over $1 million. Critics, including experts from the Citizens Budget Commission and the Manhattan Institute, warn that these hastily developed proposals could destabilize New York City's complex property tax system. They argue that imposing new taxes on a flawed assessment framework may increase market inefficiencies and drive wealthy residents away. The controversy intensified after Mamdani targeted billionaire Ken Griffin in a social media video, prompting Griffin to threaten job relocation to Miami. While Hochul initially opposed a broader millionaire tax, she has aligned with progressive allies by supporting taxes on high-value condos and co-ops. The plan involves transitioning to a new valuation system for these properties over two years. Experts remain concerned about the lack of detailed implementation plans and the potential negative impact on housing market liquidity and fairness.
New York PostHochul Proposes Pied-à-Terre Tax on NYC Homes Valued Over $1 Million
New York Governor Kathy Hochul has submitted a legislative proposal to Albany lawmakers establishing a pied-à-terre tax on non-primary residences in New York City. The plan sets a starting threshold of $1 million in market value, significantly lower than the previously discussed $5 million target shared with Mayor Zohran Mamdani. Properties valued between $1 million and $5 million would face a 4 percent tax rate, while those exceeding $5 million would be taxed at 6.5 percent unless occupied full-time. This temporary two-year measure aims to generate $500 million for the state budget. The lowered threshold addresses discrepancies where luxury apartments sell for far above their appraised values. The initiative follows public tensions between Mayor Mamdani and Citadel CEO Ken Griffin regarding a $238 million penthouse purchase, which prompted Griffin to expand operations in Miami instead of New York. While the city’s budget deficit concerns have been mitigated through other savings, this state-level tax remains a key funding strategy. Major real estate figures, including Vornado Realty Trust’s Steven Roth, have expressed opposition to the measure amidst broader debates on New York’s economic competitiveness.
Commercial ObserverHochul Proposes Pied-à-Terre Tax on NYC Homes Valued Over $1 Million
New York Governor Kathy Hochul has submitted a proposal to state lawmakers implementing a pied-à-terre tax on non-primary residences in New York City. The plan sets a starting tax rate of 4 percent for properties with a market value exceeding $1 million, rising to 6.5 percent for those valued at $5 million or more. This structure aims to generate $500 million for the state over a two-year period while a permanent agreement is negotiated. The threshold was significantly lowered from the initially discussed $5 million mark, citing disparities between appraised values and actual sale prices in the luxury market. The proposal follows public tensions between Mayor Zohran Mamdani and Citadel CEO Ken Griffin regarding a recent penthouse purchase, which prompted Griffin to expand operations in Miami instead of New York. While Mayor Mamdani recently announced measures to address the city’s budget deficit, this specific tax remains under state jurisdiction. Real estate executives, including Vornado Realty Trust’s Steven Roth, have expressed opposition to the initiative, aligning with Griffin’s stance against the proposed levies on high-value second homes.
Commercial ObserverNew York to Tax Wealthy Second Homes, Rejecting Broad Wealth Tax
New York Governor Kathy Hochul has announced a tentative budget agreement that includes a new tax on luxury second homes, known as pied-à-terres, in New York City. The measure targets properties valued over $5 million owned by individuals who primarily reside elsewhere. Hochul estimates this initiative will generate at least $500 million annually for the city. This compromise aims to satisfy Mayor Zohran Mamdani and liberal voters demanding action on wealth inequality, while avoiding broader tax hikes on the state's wealthiest residents that could drive businesses away. Critics, including business leaders and Republicans, warn the tax may encourage wealthy individuals to leave the city. Meanwhile, progressive groups argue the proposal is insufficient, covering only a fraction of the city's budget deficit. The announcement has sparked tension, highlighted by Mayor Mamdani’s social media campaign targeting billionaire Ken Griffin, who subsequently expressed safety concerns and indicated plans to expand operations in Miami. Legislative leaders note that significant budget details remain under negotiation, highlighting the ongoing political struggle between fiscal responsibility, progressive demands, and business retention in New York.
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