NYC plans to tax rich people’s backup homes

 NYC plans to tax rich people’s backup homes

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Web-spinning spiders living in penthouses overlooking Central Park might soon see a tax on their dwellings. This week, New York Gov. Kathy Hochul and NYC Mayor Zohran Mamdani announced a proposed tax on non-primary residences in the Big Apple that are valued above $5 million. The measure would affect about 13,000 second homes—aka pied-à-terres—owned by wealthy folks who mostly live elsewhere but use them as investments or a place to crash when visiting town. Taxing out-of-towners Mamdani pitched the measure as a charge on “the ultra-wealthy and global elites” that would help the city close its $5.4 billion budget gap. The Hochul administration said the proposal would bring city coffers at least $500 million yearly. An independent estimate put the haul at $232 million for a similar proposal in 2020. Proponents argue that absent neighbors should have to pull their weight: They say that the tax targets property owners who don’t pay local taxes or patronize nearby businesses, yet benefit from municipal services that support their home values. Several major cities like Paris and Vancouver already tax empty cribs. But…local real estate industry groups say it will undermine NYC’s luxury-housing market, reducing tax proceeds from bougie home sales and costing construction and maintenance jobs. Looking ahead…Hochul aims to include it in the next state budget that lawmakers are currently negotiating.