Pied-à-terre Tax Could Raise $500M — Under 5% of NYC Gap

The proposal would impose an annual surcharge on condos, co-ops and one- to three-family homes in New York City that are assessed above $5 million and owned by people whose primary residence is outside the city. Governor Kathy Hochul’s office estimates about 13,000 properties would qualify.

State projections put revenue from the surcharge at roughly $500 million a year. The New York City Comptroller projected a $2.2 billion shortfall for fiscal 2026 and a $10.4 billion gap for fiscal 2027, a combined two-year deficit of about $12.6 billion.

City officials and some analysts, including the Comptroller’s office, offer a lower revenue range of $340 million to $380 million annually for the levy. At the $500 million figure, the annual revenue is less than 5% of the $12.6 billion two-year shortfall; at the $340–$380 million range the share is smaller.

Details on the exact surcharge rate, assessment procedures and how the revenue would be allocated have been released in summary form by state officials. The proposal requires approval from the state legislature and further fiscal review before taking effect.

If enacted, the surcharge would apply only to owners who list a primary residence outside New York City and whose properties exceed the $5 million assessment threshold. Officials and analysts say additional revenue measures or spending adjustments would be required to address the larger projected budget gap.