This post, like much of the discourse around the pied-a-terre tax, is riddled with inaccuracy and demonstrates astonishing ignorance. For starters, the tax for condos is based on the DOF market value, which is a fraction of the market value.
If you really believe this logic, NYC condo prices should have collapsed. But they haven't. So the market doesn't believe this nonsense.
Some math regarding the pied-a-terre tax.
If I own a $5 million condo, the tax is 6.5% - every year, forever. That's $325,000.
Prospective buyers understand this, and they 're not stupid. They price it in.
They calculate, or "capitalize," the obligations, determining the present value of all that debt.
The numbers are devastating. Using a discount rate (or "cap rate") of 6% means you knock $5.4 million off the value of the property...
...meaning you wouldn't even take the property if it was given to you for free...
...meaning the value of the condo has been reduced to less than zero from $5 million.
You've been Zohran'd.
So, a fair question to ask is, "If my $5 million condo is now worth zero, am I now exempt from the tax? And does my exemption drive the value back to $5 million, so now I'm getting taxed again?"
Does anyone understand how insane this is?