New York Passes Zohran Mamdani’s ‘Pied-A-Terre’ Tax On Luxury Second Homes: Here Who Pays And How Much

New York state lawmakers have approved a new tax on luxury second homes in New York City. This marks a major victory for Mayor Zohran Mamdani's campaign to raise taxes on wealthy property owners to fund his ambitious affordability agenda.

The pied-à-terre tax was passed on Wednesday as part of the state budget and targets nonprimary residences valued at $1 million or more. The measure is expected to generate up to $500 million annually in additional revenue. It will take effect on July 1 and could add hundreds of thousands of dollars each year to the tax bills of some high-end condo owners, CNBC reported.

Under the plan, owners of high-end condos and co-ops will face sharply higher property tax bills, particularly during the first two years of implementation.

For the 2026-2027 and 2027-2028 tax years, second homes valued between $1 million and $3 million by the city's Department of Finance will face a 4% annual tax. Properties valued between

$3 million and $5 million will be taxed at 5.25%, while homes valued above $5 million will face a 6.5% levy.

Beginning in the 2028-2029 tax year, New York City plans to transition to a valuation system based on comparable market sales. Once updated valuations take effect, tax rates will be lowered. Properties worth between $5 million and $15 million will face a tax rate of 0.8%, homes between $15 million and $25 million will be taxed at 1.05%, and properties valued above $25 million will face a 1.3% levy.

Ken Griffin's Reaction

The measure drew national attention after billionaire Citadel CEO Ken Griffin became a prominent critic of the proposal. Mayor Mamdani had posted a video outside Griffin's penthouse apartment in support of the tax. Griffin fired back, threatening to pull back business and jobs from New York in the future.

Griffin, a Florida tax resident, bought a 24,000-square-foot penthouse at 220 Central Park South in 2019 for $238 million. However, according to government records, the city values the apartment at just $15.5 million.

Griffin's annual property tax bill on the apartment would rise from about $858,000 to roughly $1.87 million during the first phase of the tax, according to the media outlet. By 2028-2029, the bill could climb to nearly $4 million.

Griffin also owns two apartments at 740 Park Ave. purchased for a combined $83 million. Taxes on those units are projected to exceed $1 million annually beginning in 2028, bringing his total Manhattan property tax bill above $5 million.

Real estate brokers and tax attorneys warned that the tax increases could have a chilling effect on luxury property demand, CNBC reported.