Will NYC’s Cash Deal Tax Pass?

Albany’s latest attempt to tap New York City real estate for revenue may be unraveling almost as quickly as it appeared.

Just a week after lawmakers floated a new 1 percent tax on all-cash home purchases above $1 million in New York City, the proposal is reportedly on the chopping block as budget negotiations drag on in Albany. The tax was pitched as part of a broader effort to help plug the city’s multibillion-dollar budget gap and was expected to generate roughly $160 million annually. But the backlash from the residential industry was immediate and predictable.

The proposal struck a nerve because cash is no longer a niche part of the New York housing market. It’s the market, especially at the high end. Last year, 65 percent of Manhattan purchases were all cash, according to appraiser Jonathan Miller. For deals above $1 million, the share jumped to 75 percent. Across New York City, nine out of 10 deals above $3 million were cash transactions.

That means the proposed surcharge would hit a massive share of the city’s transactional volume at a time when the market is already grappling with elevated borrowing costs, affordability pressure and growing policy uncertainty.

The proposal also reflects a broader shift that has reshaped housing markets nationally over the past several years. As mortgage rates climbed to their highest levels in decades, affluent buyers increasingly bypassed financing altogether, driving a surge in cash deals across major U.S. markets from South Florida to Southern California. In Manhattan, where cash already dominates luxury sales, lawmakers now appear to be looking at those transactions as untapped tax revenue.

The irony is that the proposal may encourage exactly the kind of behavior lawmakers are trying to prevent. Brokers and analysts immediately speculated that buyers could simply take out small mortgages to avoid the tax or restructure deals in creative ways. Others warned the added cost could weigh on pricing, slow transactions and further complicate development underwriting.

Industry frustration also stems from how abruptly the proposal surfaced. The measure emerged weeks after the April 1 state budget deadline and arrived alongside another controversial proposal, Gov. Kathy Hochul’s pied-à-terre tax on second homes valued above $5 million. Brokers and developers complained that lawmakers introduced both ideas before fully explaining how either would work in practice.

That debate is already offering a preview of the concerns surrounding the cash-purchase tax. Hochul’s pied-à-terre plan, which could generate as much as $500 million annually, has sparked fears that wealthy buyers may rent instead of own, shift purchases to lower price points or redirect capital to other markets altogether. In cities like Singapore and Vancouver, similar taxes produced mixed results and, in some cases, chilled luxury investment activity.

Other cities have also experimented with transaction taxes aimed at luxury real estate and quickly altered market behavior. In Los Angeles, Measure ULA, better known as the “mansion tax,” added steep transfer taxes on high-end property sales to fund affordable housing initiatives. While it didn’t target all-cash deals specifically, brokers and developers there have pointed to slower deal volume, delayed projects and a pullback in investment activity since the measure took effect, even as the tax generated more than $1 billion in revenue.

Whether Albany ultimately scraps the proposal or revives it in another form, we’ll be paying close attention.

There was plenty of other news this week. Jared Solomon said he has $100 to his name, thousands of Zillow listings went dark in Chicago and NYC hotel workers are on track for $100K salaries. These stories and more below.

Judge orders Chicago MLS to restore Zillow access to listings

In a dramatic legal victory for Zillow, a federal judge ordered the Multiple Listing Service operator for northern Illinois, Midwest Real Estate Data, to immediately restore the portal giant’s access to its Chicagoland listing feeds on Friday. The ruling by Judge John Tharp Jr. grants a temporary restraining order, bringing roughly 43,000 vanished listings back to Zillow’s platform and temporarily halting a high-stakes standoff with MRED and megabrokerage Compass.

Jared Solomon, with $100 left to his name, can’t pay attorney

The former Vornado executive convicted of stealing nearly $10 million from the REIT says he is now effectively broke and unable to pay his own attorney ahead of sentencing. The former Vornado exec told the court through an email from Brooklyn’s Metropolitan Detention Center that he has roughly $100 left to his name after liquidating his accounts to support his family, prompting his lawyer to request permission to withdraw from the case.

Hotel union deal puts cleaners on track for $100K salaries

Some New York City hotel housekeepers are now on track to earn six-figure salaries under a landmark union contract that could reshape the economics of the hospitality industry. The tentative eight-year agreement between the Hotel and Gaming Trades Council and hotel owners covers nearly 30,000 workers across more than 250 hotels and includes what the union called the largest raises in its nearly 100-year history.

Elliman’s weak first-quarter performance casts doubt on turnaround

Douglas Elliman reported a $16 million loss in the first quarter, a sharp reversal after achieving its first profit since 2022 in the previous period, driven by a 15 percent annual decline in revenue. The company managed to lower its operating expenses during the period by nearly $27 million, but wasn’t able to offset the income dip amid an increase in some of its costs, including litigation expenses and agent commissions.

Google’s listings experiment adds pressure to fractured MLS landscape

Five months after quietly testing home listings in sponsored search results, Google has revived the experiment in select markets — this time with more allies and fewer obvious legal gray areas. The rollout, powered through a partnership with AI-enabled brokerage HouseCanary, pulls listing data from several MLSes and direct brokerage agreements, including eXp Realty.

Fraud allegations pile up against Bert I. Dweck and his family

Fraud allegations surrounding Brooklyn broker Bert I. Dweck are snowballing as investors and lenders move to target the family’s New Jersey estate and recover nearly $20 million in alleged losses. Dweck and members of his family now face 11 lawsuits across New York and New Jersey, with plaintiffs alleging he used fake real estate contracts to collect money for acquisitions that either never closed or never existed.

Penn Station rebuild finally has a master developer

A vision for a reimagined Penn Station is finally coming into focus after Amtrak and the federal government selected the winning party to serve as master developer of the project. Penn Transformation Partners emerged victorious in the contest to control the redevelopment, Gothamist reported. Other competitors included Grand Penn Partners, a team led by Macquarie Group and Penn Forward, led by Fengate.

ICSC 2026: Parties, panels, pools — and chasing down deals
This year’s ICSC in Las Vegas proved it’s still where retail real estate goes to make deals, size up the market and party deep into the night, even if the industry’s wildest excesses have cooled off from years past. More than 25,000 attendees were expected at this year’s conference, where brokers, developers, lenders and investors packed Wynn cabanas and nightclub mixers while swapping talk about the state of the retail economy.