NYC's New Pied-à-Terre Tax Could Triple Property Bills for Luxury Second Homes

New York state lawmakers approved a new tax on nonprimary residences valued at $1 million or more, projected to raise $500 million annually to help close the city’s budget gap. The tax rolls out in two phases: for tax years 2026-2027 and 2027-2028, condos and co-ops face graduated rates from 4% to 6.5% based on the city’s existing Department of Finance valuations, which experts note often reflect 10% or less of true market value. Beginning in 2028-2029, the city will shift to comparable-sales valuations and lower the headline rates to between 0.8% and 1.3% on properties above $5 million.

Citadel CEO Ken Griffin has become the political face of the policy after Mayor Zohran Mamdani filmed an announcement outside Griffin’s $238 million penthouse at 220 Central Park South. Griffin’s current property tax bill of roughly $858,000 would more than double to $1.87 million under the initial phase and climb to nearly $4 million once revised valuations take effect. Combined with his Park Avenue holdings, his total Manhattan property tax exposure would exceed $5 million per year.

The structure is administratively complex, layering a new surcharge on top of a long-criticized assessment system rather than reforming it outright. Tax attorneys warn that the sticker shock will be steep even for ultra-wealthy owners, and Griffin has publicly threatened to pull business and jobs from the city in response.