NYC home values went up, increasing the property taxes

Property owners in New York City might have to pay more in taxes as the city's tax rate remains the same, but the property market values keep increasing. 

The total market value of all New York City properties has jumped by 8.2% compared to the previous fiscal year and reached $1.4 trillion. The data comes from the NYC Department of Finance tax assessment roll for Fiscal Year (FY) 2023.

Last year, the market value of Class 2 properties that include co-ops, condos, and rental apartment buildings dropped by 8.2% due to the pandemic. The drop in property values allowed homeowners to save money on property taxes.

Recently, the real estate market has been showing signs of recovery. The market value of Class 2 properties went up by 8.7% from the previous fiscal year, increasing the tax obligations for homeowners. The growing market value of rental apartment buildings might pressure landlords to increase rent and make the housing in the city even less affordable.

Overall, the total market value of Class 1 (one- to three-family homes) and Class 2 properties continues to rebound after the COVID-related slowdown. But it seems that many hotels, retail, and office spaces remain vacant.  

“The past year has seen an uneven recovery in our city’s economy, which is reflected in the FY23 tentative assessment roll,” said Department of Finance Commissioner Preston Niblack. “Office and retail leasing activity and hotel occupancies have picked up in recent quarters, but overall office occupancy remains down, and the lack of workers and visitors means that retail stores and hotels continue to suffer. In contrast, the residential market is showing signs of a rebound, with prices and rents rising again.”

Resources:

“Department Of Finance Publishes Fiscal Year 2023 Tentative Property Tax Assessment Roll,” (NYC Department of Finance, 2022)

“NYC Property Taxes To Rise After City Hikes Real Estate Valuations,” by Miriam Hall (Bisnow New York City, 2022)

“City’s property values are up despite pandemic—and so are taxes,” by Natalie Sachmechi (Crain’s New York, 2022)