NYC pied-à-terre tax nudges second-property owners toward the market
Kevelyn Guzman (pictured top), regional vice president at Coldwell Banker Warburg in New York, was born and raised in Manhattan and has been with the firm since 2008. She said the pied-à-terre effect has been causing property owners to pick up the phone.
“Inventory is still low,” Guzman told Mortgage Professional America. “However, ever since the pied-à-terre tax announcement happened, our phones did start ringing. People just interested in selling or thinking about, ‘Do I actually need to have this second apartment anymore?’ And so we did have a few listings that we put on the market as a result of the pied-à-terre tax.”
Why spring sales fell
Spring is typically the busiest season in the New York market, and the sales decline was steeper than rates alone would explain, Guzman said. Geopolitical uncertainty was one of the main causes of the decline.
“I would say the war was a big factor,” she said. “Everyone was waiting to see what was happening there. People were concerned about investing. Every day you woke up, and it was a new story. Who are we bombing next? So there was a lot of uncertainty, and I think that that was a real driver in terms of sales. The springtime — and it’s very unusual, springtime for us we’re very busy — the war had a lot to do with it.”
Reports of widespread layoffs compounded the hesitation, she said, adding another layer of uncertainty on top of geopolitical concern. While these headwinds are causing some hesitation, Guzman said they’re also forcing buyers to have a stronger game plan before heading into the market.
