New York passes Mamdani’s "pied-a-terre" tax. Here’s who pays and how much

CNBC ^ | 05/29/2026 | Robert Frank

[SeekAndFind]

Key Points

• State lawmakers passed a tax on nonprimary residences in New York City in order to help close the city's budget gap.
• The so-called pied-a-terre tax will be imposed on second homes valued at $1 million or more and will take effect in two different phases.
• Billionaire and Citadel CEO Ken Griffin became the face of the tax after New York City Mayor Zohran Mamdani posted a video in front of Griffin's penthouse apartment announcing the tax.

New York City's new tax on second homes will more than double property taxes owed by many wealthy luxury apartment owners, according to tax experts.

State lawmakers on Wednesday passed the tax on nonprimary residences in order to help close the city's budget gap. The so-called pied-a-terre tax will be imposed on second homes valued at $1 million or more. It's expected to raise $500 million in revenue.

Details on the tax obtained by CNBC show that the property tax would take effect in two different phases. In the first two years – the tax years 2026-2027 and 2027-2028 – condos and co-ops valued at more than $1 million by the city's Department of Finance will be subject to the tax. Properties worth between $1 million and $3 million will face a 4% annual tax; properties valued at $3 million to $5 million will face a 5.25% tax; and those above $5 million will face a 6.5% tax.

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.

Rather than overhaul the system immediately, the city will gradually update valuations – and the tax – according to the budget documents.

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TOPICS: Business/Economy; Government; News/Current Events; US: New York
KEYWORDS: byebyenyc; communism; mamdani; millionaire; nyc; piedaterre; realestate; tax

[Libloather]

...homes valued at $1 million...

That's like everyone. But they did vote for this. Was there any opposition to the commies? Sit down and shaddap.

[vaskypilot]

No one will bother to own a home in New York City. Those who would want a second home for business will move their business elsewhere.

[ansel12]

We need laws that forbid tax increases when government is in debt, other than the normal functioning kind that isn’t a part of excess spending.

The economics guys here can define that with the proper language.

[EastTexasTraveler]

“It’s expected to raise $500 million in revenue.”

The one thing you can be sure of is that it will raise no where near this amount.

They always assume that people will just sit still and pay the new taxes rather than take other actions.

[SkyDancer]

And as more tax payers leave the city.

[ChronicMA]

this was passed by the state legislature

that means there are all sorts of non-NYC legislators who voted for this.

everyone in their districts throughout the state needs to be made aware of their vote.

[MileHi]

No one will bother to own a home in New York City.

At some point current owners will be left holding the bag as no will want to buy their property and their investment will move toward worthless.

[Windcatcher]

Every freedom-loving person in NY and NJ, who intends to never vote Dem, should just come to PA. We’ll row over and sneak you across the Delaware in the dark of night. Look for our lantern.

[chuck allen]

You can also be sure that whatever revenue is raised it won’t matter, as the budget gap will still get wider because that’s what liberal airheads do. Tax and spend.

[Pol-92064]

That is true for landlords. Buy a house or apartment then have the gov’t dictate your rent and the use of the units. That is a recipe for disaster.

[MrRelevant]

But Mahamdi already has plans to spend 40 billion on new housing….

[frank ballenger]

Like the saying the only constants in life are death and taxes.

Death stays pretty much the same but taxes go up whenever the state legislature is in session.

[Robert A Cook PE]

These are the same NYC democrats who deliberately undervalued President Trump’s residences to charge him with falsifying bank loam applications.

[vaskypilot]

I agree. I feel for the property owners. No one will want to live or do business in New York.

[Robert A Cook PE]

Two lanterns! Two if by sea. Two.

[Windcatcher]

Very well. And have faith; we’ve done this sort of thing before!

Tricornes are optional.

[ansel12]

We need a way to force them to turn to cuts when they get into debt, not merely spend and then raise taxes to pay for what they did.

[gildafarrell]

Florida has something similar but not based on the value of the 2nd home but how much time you spend there and if you rent the place out.

[anton]

I already figured out how to beat it. Just form a real estate brokerage that both owns real estate for sale and lists properties owned by others. Buy the units with 100% seller financing, hold them in inventory, and rent them back to the seller’s company while they are listed for sale. It will be a coincidence that the rent is pretty close to the interest on the seller financing.

Your welcome. Send my fee to Grand Cayman.