“Today, I am releasing the City’s first budget. After years of financial mismanagement, we are looking at a $5.4 billion budget gap – and two ways. First: Albany can raise taxes on the richest and most profitable companies and address the financial imbalance between our city and the province using only the budget balance, the rest of the money is used to restore the balance of our country. The City’s repeal,” said Mamdani in a letter on Tuesday to X.
“Since the city cannot do any other way, it will have to use the revenue lever to the fullest that we have. We will have to increase property taxes. We will be forced to raid our reserves,” said Mamdani when he commented on Tuesday. “This would be a tax on working and middle-class New Yorkers, with an income of $122,000.”
Both agents warned that taxing high-income earners could cause another wealth challenge, reducing the tax base and ultimately leaving middle-class families “holding the bag.”
New York City Mayor Zohran Mamdani called on the state to raise taxes on corporations and the wealthy to help deal with the city’s budget deficit on Tuesday, warning that the alternative would be for the city to raise property taxes.
“Higher corporate and wealth taxes can create a reaction,” Jacobs said. “Decreased investment and high-income migration reduces the city’s tax base, which often indirectly affects middle-class households. Even if not the direct target, in the long run these economic upheavals can affect purchasing power, property values and access to services.”
“In many cases, property tax increases end up being absorbed by renters, especially in stable or market-rate units where landlords factor operating costs into the price,” added Griffith. “While the Mayor’s promise of ‘rent stability’ is admirable, history shows that higher property taxes can translate into higher rents quickly, sometimes within a year. Working families may end up feeling the impact, even if not immediately.”
Various clients of Jacobs and Griffith are also said to see danger in Mamdani’s economic proposals.
The average cost of renting in New York City is $3,454 per month, according to the latest Zillow data. (Getty Images)
“Many of my clients view rate hikes in a system they already view as inequitable as a Band-Aid solution. Buyers and sellers alike would welcome a comprehensive reassessment that reflects the true value of properties and promotes fairness,” explains Griffith. “Temporary spikes often create uncertainty in the market, whereas a transparent and balanced approach will stabilize it in the long term.”
“Flat climbing in a system that is already out of sync with the value of real assets risks inequality,” Jacobs said.
Real estate is a game of certainty, and Mamdani’s proposal has created quite the opposite as agents look to the future of the NYC market.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
FOX Business Correspondent Lydia Hu explains NYC Mayor Zohran Mamdani’s call for tax hikes on wealthy New Yorkers and more on ‘Varney & Co.’
“Buyers and sellers are focused on long-term purchases and predictability. Without clear guidance on taxes and assessments, the market moves slowly and buyers proceed with caution, which is especially true for middle-class families,” said Jacobs.
“Ultimately, consumers want predictability. When policy proposals create uncertainty, whether it’s about taxes, rents or regulations, it directly affects the market. People don’t just look at the sticker price of a property,” said Griffith. “Stability and transparency in tax policies and assessments are critical to keeping NYC’s inner-city families confident in making big housing decisions.”
Fox News Digital reached out to Mamdani’s office for comment but did not receive a response by press time.
READ MORE AT FOX BUSINESS
FOX Business’ Alex Nitzberg contributed to this report.
