President claims ‘thousands of people… are fleeing the city, never to return’ because of Mamdani’s luxury second-home levy
President Trump blasted New York’s pied-à-terre tax in a Tuesday Truth Social post and suggested the federal government was considering attempting to block the measure, a signature policy of Mayor Zohran Mamdani.
The president said he was “looking to see if the Federal Government has any legal right to avert this disaster, before it is too late, for the millions of people who cherish New York and want to see it thrive,” setting the stage for a potential legal showdown over the tax.
On Monday, a New York judge temporarily blocked the tax, which was passed by the New York State legislature in May and championed by Mamdani during his successful mayoral election campaign last year.
The judge’s Monday order to block the policy was placed on hold after a swift lawsuit by New York City government, and Mamdani said in a press conference yesterday that he and his team would “vigorously” defend the tax in court.
The levy targets owners of second homes and other non-primary residences valued above a certain amount who don’t live in the city full-time,
In his Tuesday Truth Social post, Trump claimed other states were benefiting from the measure and said wealthy property owners were abandoning New York because of the tax.
“The NYC Pied-a-Terre Tax is costing New York City and State a fortune in that the money, eventually to be gotten, is very little compared to to [sic] the TAXES PAID by the tens of thousands of people who are fleeing the City, never to return,” he wrote.
Mamdani said in yesterday’s press conference that his team was confident of success in the case – “and that is a confidence coming from both the legality of the City’s actions as well as the importance of a surcharge on secondary homes worth more than $5 million, a surcharge that will help fund safer streets, that will help fund stronger schools, and it will help fund the city that New Yorkers deserve.”
Some real estate and mortgage professionals based in the city have suggested the measure could spur an uptick in listings as wealthy real estate investors seek to sell their property to avoid the tax.
Kevelyn Guzman, regional vice president at Coldwell Banker Warburg, told Mortgage Professional America last month that plenty of clients were now asking, “Do I actually need to have this second apartment anymore?”
Others don’t see the tax having a significant negative effect despite the furor it’s caused. “I think in the end, it probably will not have a huge impact on the city,” Melissa Cohn, regional vice president at William Raveis Mortgage, told MPA.
“Remember when the mansion tax started and everyone said, ‘People aren’t going to buy, and this is a problem, and it’s going to ruin the real estate market?’ And nothing really happened.”
It remains unclear what means, if any, the federal government can deploy to halt or strike down the tax.
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