What everyone is missing about Mamdani’s plan to tax Ken Griffin’s $238 million penthouse

Key Points:

• New York City Mayor Zohran Mamdani announced a pied-à-terre tax targeting second homes of the wealthy, highlighting billionaire Ken Griffin’s undervalued $238 million penthouse as an example of the city’s unfair property tax system.
• The city’s property tax system significantly undervalues luxury condos and co-ops by assessing them based on hypothetical rental income rather than market value, contributing to wealth storage in empty high-end properties and exacerbating the housing crisis.
• Critics argue that while a pied-à-terre tax may raise funds and encourage primary residency, it does not address the core issues of New York’s flawed property tax regime, which disproportionately affects renters and residents in less affluent neighborhoods.
• Despite concerns about wealthy residents fleeing due to taxes, studies show that millionaires have low migration rates and most moves are not primarily tax-driven; instead, families with young children are leaving cities like New York due to affordability challenges.
• Mamdani’s pied-à-terre tax is a modest step compared to his broader campaign promises of raising income taxes on the wealthy and corporations, which have been rejected by New York Governor Kathy Hochul, leaving experts skeptical about the impact on the city’s richest residents.