New York lawmakers passed a tax on multimillion-dollar second homes in New York City back in May, with critics warning it would send wealthy buyers running for the exits. Months later, the data tells a different story: signed contracts for apartments subject to the levy actually climbed, from about 420 between June and October of last year to more than 580 during that same stretch this year. The tax briefly took effect in July before a judge blocked its rollout in August.
The pied-à-terre tax was passed as part of the New York State budget, according to The New York Times. The paper describes it as intended to apply to New York City homes with a market value of $5 million or more that are not a primary residence, though CNBC has separately described the surcharge as applying to non-primary residences the city values at more than $1 million — a discrepancy the available reporting does not resolve. Whatever the precise cutoff, the Times reports the surcharge would be paid every year on top of other property taxes, layered atop the city's existing mansion tax, which is paid when an apartment sells for at least $1 million.
Opponents of the tax worried that wealthy apartment owners would flee New York City altogether, hurting high-end home sales and denting the city's tax haul, the Times reports. It was a concern voiced by opponents of the surcharge. But the contract numbers collected this year don't show that kind of exodus playing out.
What the Contract Numbers Actually Show
Zoom out a bit further and the pattern holds. Between June and October 2024 — before the tax existed — 400 contracts were signed for the type of apartments that would eventually fall under the surcharge, the Times reports. That rose to about 420 in the same months of 2025, and then jumped to more than 580 this year, although the tax briefly took effect in July before a judge blocked its rollout in August.
Jonathan Miller, an appraiser and consultant, told the Times the tax does not appear to be having a material impact. It's a notable read from someone who tracks the market closely, and it lines up with separate figures Miller has supplied elsewhere: he has said Manhattan luxury inventory is down 40 percent compared with the prior year and sits at its lowest level since he began tracking it in 2004, according to CNBC. Thin supply alone can keep contract activity brisk regardless of new carrying costs.
Other Market Snapshots Point the Same Direction
Other data gathered after the tax passed tells a broadly similar tale, even if it covers different price bands and time windows. In the 16 weeks after the tax passed, sales of Manhattan condos, co-ops and townhomes worth more than $5 million rose 1 percent year over year and 3 percent against the five-year average, per a report from Commercial Observer. From April to August, that outlet found sales between $5 million and $15 million up 2 percent year over year, while sales between $15 million and $25 million climbed 8 percent. For April to August, homes priced at $25 million or more were down 20 percent year over year, the same report notes — a reminder that the very top of the market hasn't moved uniformly.
During that same first week of August, Commercial Observer counted 16 contracts signed above $5 million, a 7 percent increase over the same week a year earlier, with a $40.5 million full-floor residence at 1122 Madison Avenue topping the list. Earlier in the year, Olshan Realty reported 126 contracts for Manhattan apartments priced at $4 million or more in June, up from 124 in the same four-week stretch of 2025, the CNBC report notes. Brown Harris Stevens separately found Manhattan's average apartment price up 5 percent year over year in the second quarter, to roughly $2.2 million.
Compass data cited in that same CNBC report found even sharper movement further up the ladder: sales of condos priced between $10 million and $20 million surged 55 percent, while sales above $20 million rose 33 percent, with average asking prices up 14 percent. None of these figures establish that the tax itself drove the gains, and the reports cover overlapping but distinct segments of the market rather than a single, unified data set.
Disputed Numbers on Threshold and Revenue
Beyond the differing accounts of who exactly owes the tax, projections of how much it will bring in also diverge. Governor Hochul's proposal described the measure as a surcharge for wealthy non-New York City residents who own luxury second homes in the city valued at $5 million or more, and projected it would generate approximately $500 million annually in recurring revenue for the city. CNBC, however, reported that while Governor Hochul and Mayor Mamdani have cited that same $500 million figure, the city comptroller's office estimates actual annual revenue closer to $340 million to $380 million.
Those gaps — on both who pays and how much the tax ultimately raises — remain unresolved in the public record so far. What the contract data does suggest, at least through this fall, is that the wave of departures critics predicted has not materialized since the measure cleared Albany in May.
