Real estate insiders reveal the real cost of Mamdanis pied--terre tax and what its really doing to NYC

Buyers with big budgets are bewildered.Brokers, builders and building boards are apoplectic.

It’s only been a month Mayor Zohran Mamdani’s so-called “pied-à-terre” tax on second homes valued over $5 million took effect, and the city’s real estate market is already reeling.“The numbers are so beyond what people are interested in spending every year that many people are rethinking,” said Pamela D’Arc, a Compass agent who frequently sells luxury city residences to tech and Hollywood execs from California, told The Post.“People are listing things for sale that they don’t use a lot.

Buyers are sitting on the sidelines.I have clients that have changed their price point to be just under $5 million.”Highly priced new buildings that lure out-of-town buyers are particularly vulnerable to the tax, which starts at 4% and rises to 6.5% annually in Phase 1.

(A second phase will update the calculation in the 2028/29 tax year).“We had a buyer from Madrid who also has a home in Miami.

She was very attracted to the [new] Giorgio Armani Residences at 760 Madison Avenue, partially because of the name, partially because of the location,” Douglas Wagner, Director of Brokerage Services at BOND New York, told The Post.“She had been watching a particular unit pre-market while it was still under construction, and when the price came down, she got serious.

But we were coming up on July 1, and we told her about the pied-à-terre tax and what to expect.Around July 11th, she let us know that she was suspending her search because of the extra expense.”That unit, No.

6B at the fashion-branded Lennox Hill condominium has common charges and taxes that add up to roughly $120,000 per year.Based on its city-calculated valuation, the $8.9 million unit would eventually owe another $40,000 to $50,000 in annual tax, Wagner says.

That sponsor unit is still for sale as a result.The many “empty towers” of Billionaires Row, both lauded and lampooned as Swiss bank vault...