New York Proposes Tax on Luxury Second Homes

Revenue would help close NYC's $5.4 billion budget deficit.

Apr. 15, 2026 at 10:04pm

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A photorealistic painting of a tall, sleek luxury apartment building in New York City, with the facade bathed in warm, golden sunlight and deep shadows, conveying a sense of solitude and contemplation.The debate over taxing luxury second homes in New York City reflects the city's struggle to balance its budget while addressing concerns from the real estate industry.NYC Today

New York Gov. Kathy Hochul and Mayor Zohran Mamdani are backing a new tax on owners of second homes in New York City worth $5 million or more. The proposal aims to raise $500 million from non-residents to help the city cover its budget deficit. Officials say the tax targets those who own luxury homes in the city but do not live in them full-time, arguing they should contribute more to the city that generates their property's value.

Why it matters

New York City faces a significant $5.4 billion budget deficit, and officials are looking for new revenue sources. This proposed tax on luxury second homes is seen as a way to have the wealthy who benefit from the city's real estate market contribute more to its upkeep, without directly impacting full-time residents.

The details

The tax would apply to owners of second homes worth $5 million or more that are not occupied full-time. Owners could avoid the tax by having a full-time tenant in the home. Officials estimate the tax could raise up to $650 million annually. The Real Estate Board of New York has expressed skepticism about the revenue projections, arguing the tax will hurt the broader economy and housing market.

  • The proposal was announced by Gov. Hochul on April 14, 2026.
  • Mayor Mamdani discussed the tax at a Tax Day forum on April 15, 2026.

The players

Kathy Hochul

The governor of New York who is backing the proposed tax on luxury second homes in New York City.

Zohran Mamdani

The mayor of New York City who is supporting the tax proposal, arguing the wealthy should contribute more to the city that generates their property's value.

Julie Menin

The New York City Council speaker who expressed support for the tax proposal.

Jamles Whelan

The president of the Real Estate Board of New York, who expressed skepticism about the tax's impact on the broader economy and housing market.

Gabriel Zucman

An economist who participated in the Tax Day forum with Mayor Mamdani.

Joseph Stiglitz

An economist who participated in the Tax Day forum with Mayor Mamdani.

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What they’re saying

“The property value of homes like that is driven by everything New York City has to offer. Those who benefit from the city without living in a full-time capacity should contribute to the cost that it takes to run the city.”

— Kathy Hochul, Governor of New York

“Too many ultra-wealthy second homes sit empty most of the year, part of our skyline but not part of this city. Anyone treating New York City like an investment should be contributing to what makes it valuable.”

— Kathy Hochul, Governor of New York

“A smart, sensible step from @GovKathyHochul to generate revenue for the services New Yorkers rely on.”

— Julie Menin, New York City Council Speaker

“Its impact will reach far beyond a small group of owners. It will not raise the amount of revenue expected, but will eliminate thousands of construction jobs, lower property values, and raise costs for New Yorkers.”

— Jamles Whelan, President, Real Estate Board of New York

What’s next

The proposal will need to be approved by the New York State legislature before it can be implemented.

The takeaway

This tax on luxury second homes is a controversial but potentially significant revenue source for New York City as it grapples with a major budget deficit. The debate highlights the tensions between the city's need for funding and concerns about the impact on the real estate market and wealthy property owners.