We are currently undergoing housing crisis, but are missing the pink elephant in the room exemplified by Billionaire's Row.

In 2019, a $238,000,000 condo on Billionaires’ Row was assessed at just $9.4 million for tax purposes.

That’s about 4% of its actual sale price (effective tax rate: ~0.22% of market value).

Meanwhile, ordinary NYC homeowners
often pay around 1%–1.4% of their home’s value in property taxes.

Why?

Because luxury condos aren’t taxed based on what they sell for. They’re assessed using a rental-income formula.

This outcome is driven by state law requiring most condos to be valued as rental properties, even when they are owner-occupied homes with no rental equivalence.

NYC’s largest revenue source comes from property tax. It's only fair to align tax assessments with real market prices, not hypothetical rental income formulas.

 

 

 

What can be done?

Option A

1. Reform condominium assessment methodology so that all owner-occupied homes are valued using transparent, sales-based comparables rather than hypothetical rental income formulas.
2. Publish annual data showing sale price vs assessed value vs effective tax rate across all residential property classes.

Option B

If appraisal reform proves politically or administratively complex, lawmakers should evaluate a vacancy tax applied to non-primary residences, similar to policies used in parts of Europe and Canada. A vacancy tax targets housing used primarily as stored value rather than housing used as a primary residence, without altering the broader assessment framework.

NYC’s property tax system is its largest revenue source. It should apply a consistent valuation logic to every homeowner without carve-outs or structural distortions.

This is a smart first step to ameloriate the housing crisis issues in NYC.