Not a city of mansions: Small percentage of resi sales were pricier than $2M, says IBO

De Blasio is seeking to institute a 2.5% RE transfer tax

New York /
Feb.February 20, 2017 07:00 AM

Critics of Mayor Bill de Blasio’s proposed “mansion tax” object to the measure’s $2 million threshold, but a new report argues that a small percentage of residential sales actually exceed this price point.

Of the 156,324 residential sales from 2014 to 2016, only 8 percent cost more than $2 million, according to a report released by the Independent Budget Office on Friday. Nearly 47 percent were for $500,000 or less.

The mayor renewed his call for a mansion tax in January, which would impose a 2.5 percent property transfer tax on all home sales of $2 million or more. During his State of the City address earlier this week. the mayor said this tax would pay for 25,000 additional units for senior citizens.

Those who oppose the measure argue that it doesn’t reflect the realities of real estate in the city. In some neighborhood, $2 million hardly buys a mansion.

“With $2 million you can get a nice two-bedroom,” Joan Kagan of TripleMint TRData LogoTINY told the Wall Street Journal. “When you think about a family with children who wants to stay here for a little bit of time, they’re the ones that are going to be affected by the tax.”

Unsurprisingly, most of the total sales between $2 million and $5 million in 2016 were in Manhattan (7,396). Brooklyn followed with 1,478 sales in this range, Queens with 115, and the Bronx with 22. Still, even in Manhattan, most sales in 2016 were between $500,000 and $1 million.

The IBO report points out that in 2016, only 10 “neighborhoods” accounted for three-quarters of the residential sales of more than $2 million throughout the city. IBO lumps a few neighborhoods together for the top spot — Soho-Tribeca-Civic Center-Little Italy — which saw 600 sales at this price point last year. Upper East Side-Carnegie Hill and the West Village followed, with 437 and 427 sales, respectively.


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