Things are tough here in New York City. And if you own a second home here, they’re about to get tougher. Three New York State lawmakers are revisiting legislation to tax rich people’s second homes. They want more revenue for the city. Understandable, since the city is broke. But are they considering the knock-on effects and the long term problems it could cause?
Real Estate Broker Michael Franco says it’s projected to raise $650 million dollars in revenue for New York City. But, there are other factors that don’t look so good—like lower property values. The pressure of the tax encourages selling, which increases inventory and creates downward pressure on real estate values.
The CEO of luxury real estate brokerage Warburg Realty says you don’t want to discourage anybody—from any income bracket—from owning real estate in the city.