NYC fires warning shot at 960,000 properties with pied-à-terre tax list

New York City published a preliminary list of nearly 1 million property owners who may owe Mayor Zohran Mamdani's new surcharge on luxury second homes, a tax designed to raise at least $500 million annually from the city's wealthiest residents.

New York City released a list of roughly 960,000 properties that may be subject to Mayor Zohran Mamdani's new tax on second homes worth $5 million or more, a levy expected to raise at least $500 million a year for the city's coffers. The surcharge, which took effect July 1, targets owners who declare their primary residence outside the five boroughs while holding luxury property in the city.

"Publishing a list of individual taxpayers' names alongside a policy designed to raise revenue from them sends an implicit message that these are people who've done something wrong, rather than simply people the city has chosen to tax more," said Steven Fulop, president and chief executive of Partnership for New York City, a prominent business group. "The mayor has already won the election — he doesn't need to govern by singling people out to make a political point."

The preliminary database, published July 25, includes owners' names, addresses and market values across all five boroughs. The list encompasses about 960,000 units out of 3.7 million citywide — far more than the roughly 10,000 second homes that New York Gov. Kathy Hochul's office estimates will ultimately be subject to the surcharge. Notable names include Commerce Secretary Howard Lutnick as trustee of a $37 million property, President Trump's niece Mary Trump, filmmaker Darren Aronofsky and the ex-wife of billionaire financier John Paulson, who owns a nearly $76 million townhouse on the Upper East Side.

The tax can add tens of thousands of dollars to annual bills for owners of luxury second homes. Ken Griffin, the billionaire founder of Citadel, could owe $1 million a year on his Central Park South penthouse on top of the $837,000 in property taxes he already pays. The Finance Department plans to finalize the list in December, with homeowners able to appeal by Aug. 21.

Confusion and backlash among homeowners

The rollout has sparked confusion among residents who say they were wrongly flagged. An 81-year-old woman on the Upper East Side who has lived in her townhouse full time for 30 years received a warning letter stating she has until Aug. 21 to prove she is exempt or face a $56,000 bill. On Staten Island, Eugen Dooley, a retiree on Social Security, found his condo in the database despite owning only one home.

Borough President Vito Fossella, whose name appeared on the list for a home owned by his father, called the database "almost like an enemies list." The city says it is committed to implementing the surcharge "fairly and efficiently" and has hired extra staff and launched a dedicated website to help property owners navigate the requirement.

Revenue imperative behind the tax

Mamdani, a Democratic socialist who won office on an affordability platform, pushed the pied-à-terre tax as part of a broader effort to raise revenue from the wealthy without cutting services. He had sought larger tax increases on high-income earners and corporations, but Hochul backed only the pied-à-terre measure, which her office estimates will generate at least $500 million annually. The previous year's budget gap had threatened cuts to transit and education, giving the administration a fiscal rationale for targeting out-of-state owners of high-end real estate.

The city typically publishes an annual tax roll of all property owners, and real estate attorneys note the information included is the same type that has long been publicly available. "It's not doxxing because it's all the same information that's on the regular roll," said Adrian Diaz, a property-tax attorney at Hogan Lovells Cadwalader. But Diaz said the sheer size of the list — roughly 25 percent of all city units — is enough to alarm homeowners who may find their names despite not ultimately being subject to the tax. "A shorter list, something more targeted would have been more appropriate," he said.

The last time New York imposed a major new property surcharge was the mansion tax introduced in 2019, which added a sliding fee on transactions above $1 million and raised about $400 million in its first year. That tax applied broadly to buyers rather than singling out non-primary residents, and it faced less political blowback than the current measure.

This article is for informational purposes only and does not constitute investment advice.