Mamdani’s Second Home Tax Faces Bigger Legal Test After Court Victory
Summary
A New York appeals court reversed a lower-court ruling that had ordered the city to redo its notices for a tax on certain high-value second homes. The decision lets Mayor Zohran Mamdani’s administration continue the rollout while the legal challenge proceeds; it does not resolve the broader challenge to the tax itself.Key Facts
- New York City and state officials proposed the surcharge in April, and it was included in New York State’s 2026 budget as the Non-Primary Residence Surcharge.
- The tax applies to qualifying one- to three-family homes worth at least $5 million and condominiums and co-op units worth at least $1 million.
- The surcharge took effect July 1, but affected owners are expected to see it on property tax bills starting January 1, 2027.
- The city estimated that about 13,000 properties could be affected and that the tax could raise about $500 million a year.
- Homeowners sued over the city’s process for identifying properties and sending notices; some said they were wrongly flagged.
- On September 29, a state Supreme Court judge ruled that the city had not followed required procedures and ordered it to remove the supplemental property list, cancel notices, and redo the notification process.
- The city appealed, and the appeals court’s Wednesday ruling reversed the lower-court decision, allowing the rollout to continue.
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