New York court sides with Mamdani and allows the luxury second-home tax to move forward

A New York appeals court ruled on Wednesday in favor of Mayor Zohran Mamdani's administration, allowing the city to continue applying the tax on luxury second homes, known as the pied-à-terre surcharge, one of the centerpieces of his economic agenda.

The Appellate Division of the state Supreme Court, based in Brooklyn, unanimously concluded that the seven homeowners who sued the city had not shown a concrete harm giving them standing to litigate, and ordered the lawsuit dismissed. The ruling reverses the September 29 decision by Judge Wayne Ozzi of Staten Island, who had ordered the implementation process restarted from scratch.

The surcharge, approved by the state Legislature in May and signed by Governor Kathy Hochul as part of the fiscal year 2027 budget, applies to condominiums worth more than one million dollars and homes worth more than five million dollars that are not their owners' primary residence. The Department of Finance sent notices to about 17,000 property owners when implementation began in July.

The administration estimates the tax will raise about $500 million a year, although Comptroller Mark Levine had projected up to $380 million. Mamdani welcomed the ruling, saying the surcharge will help fund safer streets, cleaner parks and essential public services. The dispute is not over: two separate lawsuits in Suffolk County challenge the measure's constitutionality.

Photo: AP

Source: Sondeo Latino