{"id":208546,"date":"2026-04-24T17:24:08","date_gmt":"2026-04-24T17:24:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ny\/208546\/"},"modified":"2026-04-24T17:24:08","modified_gmt":"2026-04-24T17:24:08","slug":"mamdani-hochuls-pied-a-terre-tax-would-bring-legal-battles-over-nyc-property-values-experts-say","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ny\/208546\/","title":{"rendered":"Mamdani, Hochul’s pied-\u00e0-terre tax would bring legal battles over NYC property values, experts say"},"content":{"rendered":"

Mayor Zohran Mamdani and Gov. Kathy Hochul\u2019s controversial proposal for a pied-\u00e0-terre tax<\/a> in New York City could bring a wave of legal battles from wealthy New Yorkers avoid new levies, according to experts.<\/p>\n

The Dems last week announced a new tax on luxury second homes worth more than $5 million. <\/p>\n

But as experts noted, there is a huge difference between NYC\u2019s property assessment values and market values, and the pols have yet to clarify which figure will be used for the new levies.<\/p>\n

If the democratic socialist and his Albany ally choose to factor in market values, which are typically far higher than the assessment values churned out by NYC\u2019s outdated system, wealthy New Yorkers may respond in court, hiring their own appraisers.<\/p>\n

Demonstrators staged a sit-in Thursday inside New York Gov. Kathy Hochul\u2019s office demanding taxes on the wealthy. REUTERS<\/p>\n

\u201cAnyone with a value between $5 million and $6 million is going to be going down to the courthouse to fight this,\u201d Nathan Goldman, a member of the American Accounting Association and a professor at North Carolina State University, told The Post.<\/p>\n

\u201cThere are gonna be a whole lot extra layers of legal battles that ensue as a result of this because this isn\u2019t like the stock market,\u201d he said. \u201cThis is a subjective number.\u201d<\/p>\n

The new tax will raise $500 million per year for the city\u2019s budget, say Mamdani and Hochul \u2014 who initially opposed the mayor\u2019s tax-the-rich platform but pivoted during this year\u2019s state budget fight.<\/p>\n

But they have released few details on how the fee, which still needs approval from the state legislature, will actually work.\u00a0<\/p>\n

\u201cMamdani was desperate. I think he was very interested in getting a win\u201d by his 100th day in office, Goldman said. \u201cBut this is far away from anything officially being ironed out.\u201d<\/p>\n

The\u00a0pied-\u00e0-terre policy is already facing harsh criticism from business leaders concerned it could fuel an exodus of wealth from the city.<\/p>\n

Citadel founder Ken Griffin \u2013 whose $238 million Manhattan penthouse was attacked in Mamdani\u2019s viral video<\/a> announcing the tax \u2013 signaled Thursday that he\u2019s so appalled<\/a>, he is considering scrapping a major Midtown project.<\/p>\n

Fellow billionaire Bill Ackman also lashed out at the policy, arguing that non-resident owners of Big Apple properties drive economic growth without acting as a drain on local resources \u2013 and warning that Mamdani\u2019s tax could push more business to Florida<\/a>.\u00a0<\/p>\n

Mayor Mamdani announced the controversial new tax policy in a video filmed outside Ken Griffin\u2019s penthouse. @NYCMayor \/X<\/p>\n

In one of the most expensive real estate markets in the world, the new tax policy could have a huge impact.<\/p>\n

About 70% of properties sold for $5 million or more are second homes, Jonathan Miller, CEO of appraisal company Miller Samuel, told CNBC<\/a>.\u00a0<\/p>\n

Over the past five years, 4,146 Manhattan apartments sold for at least $5 million, he said \u2013 and the new tax policy could hit their owners in vastly different ways depending on how the city implements the proposed tax.<\/p>\n

Griffin bought his 24,000-square-foot penthouse at 220 Central Park South in 2019, with the nine-figure price tag making it the highest home sale ever in the US.<\/p>\n

Under the city\u2019s arcane rules, officials currently give it a market value of $15.5 million and an assessment value of just $6.99 million, Robert Pollack, senior partner at Marcus & Pollack LLP, told The Post.<\/p>\n

\t\t\t\t\t\t\tStart your day with all you need to know\t\t\t\t\t\t<\/p>\n

\n\t\t\t\t\t\t\tMorning Report delivers the latest news, videos, photos and more.\t\t\t\t\t\t<\/p>\n

\t\t\t\t\t\tThanks for signing up!\n\t\t\t\t<\/p>\n

In New York City, co-ops and condos are not valued based on how much they sell for, but on what they would rent for if they were apartments \u2014 which is why the assessments in the case of Griffin\u2019s property and many others are so low, Pollack explained.<\/p>\n

The city estimated Griffin\u2019s condo would rent for $239,255 per month for tax year 2025-26, giving it a market value of $15.5 million, according to a notice of property value.<\/p>\n

It uses a complex formula based on a range of variables, including rental buildings with similar characteristics and rental trends in similar neighborhoods \u2013 but it\u2019s widely criticized for being outdated and inaccurate.<\/p>\n

To reach an NYC assessment value, the city ignores the $238 million transaction value altogether, and simply calculates 45% of the market value \u2013 which is about $6.99 million.<\/p>\n

It\u2019s not year clear how much extra tax Griffin could face under Mamdani and Hochul\u2019s pied-\u00e0-terre plan.<\/p>\n

The city\u2019s assessment of property values are vastly different from market values. Christopher Sadowski<\/p>\n

Another unresolved issue in the pied-\u00e0-terre tax proposal is whether it will have a graduated rate \u2014 as was the case with a 2019 proposal that suggested a 0.5% tax on properties worth over $5 million, a 1.5% rate on properties over $10 million and 4% for those over $25 million.<\/p>\n

If that\u2019s the case, New Yorkers could soon notice a swath of apartments valued at $4.98 million to avoid the tax, or at $24.9 million to escape the highest rate, according to experts.<\/p>\n

Yet another unclear detail concerns whether the proposed tax will apply to a home\u2019s entire property value or only to its value over $5 million. Rhode Island took the latter approach with its pied-\u00e0-terre tax \u2014 also known as the \u201cTaylor Swift Tax\u201d since it targeted the singer\u2019s $17 million Rhode Island vacation home.<\/p>\n

New York City will also need to clarify who counts as a non-resident owner, since many will likely seek to skirt the tax by making their penthouses their primary residences, Goldman said.<\/p>\n

\u201cIf Ken Griffin\u2019s only at his condo for three months of the year, is he gonna be subject to this tax? We don\u2019t know,\u201d he told The Post.<\/p>\n

\u201cPeople game these systems all the time. They don\u2019t report certain additions, they do their own appraisals and use beneficial comps that will help them depress their property values,\u201d Goldman added.\u00a0<\/p>\n

\u201cNow their financial advisers are going to be telling them to claim this as their primary residence.\u201d<\/p>\n

Wealthy property owners will likely try to argue that their property values are decreasing, not increasing, since the tax will make buyers less likely to scoop up properties worth $5 million or more, Goldman said.<\/p>\n","protected":false},"excerpt":{"rendered":"Mayor Zohran Mamdani and Gov. Kathy Hochul\u2019s controversial proposal for a pied-\u00e0-terre tax in New York City could…\n","protected":false},"author":2,"featured_media":208547,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[288,426,1023,57,9,24,56,63,65,64,2780,82],"class_list":{"0":"post-208546","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-new-york-city","8":"tag-business","9":"tag-kathy-hochul","10":"tag-luxury-real-estate","11":"tag-metro","12":"tag-new-york","13":"tag-new-york-city","14":"tag-ny","15":"tag-nyc","16":"tag-nyc-headlines","17":"tag-nyc-news","18":"tag-taxes","19":"tag-zohran-mamdani"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/208546","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=208546"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/208546\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/208547"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=208546"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=208546"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=208546"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}