Key takeaways:
- NYC property taxes on one- to three-family homes are surprisingly low. The city’s effective tax rate for Class 1 properties is about 1.19%, among the lowest in the New York tri-state area and below some major US cities.
- A home’s tax bill is based on its assessed value, not market value. For Class 1 properties, assessed value is generally 6% of market value, and assessment growth is capped at 6% annually or 20% over five years, helping longtime owners keep taxes down.
- Condos and co-ops are taxed differently from one- to three-family homes. Instead of being assessed based on sales prices, they’re valued as if they were rental buildings, using estimated rental income from comparable properties.
- Critics argue that modest condos and co-ops can be overtaxed relative to one- to three-family homes, while some of the city’s most expensive luxury apartments are significantly under-taxed relative to their true market value.
Note: This guide is for informational purposes only. This resource is not a substitute for the advice or service of an attorney; you should not rely on this resource for any purpose without consulting with a licensed attorney in your jurisdiction. Housing laws and regulations are subject to change; information in this article may not reflect the most current legal developments. This article is specific to New York City; laws differ in other jurisdictions.
New York has a reputation for being a high-tax city, but when it comes to property taxes, the reality is considerably less than the expectation. NYC property taxes are, for many homeowners, surprisingly reasonable.
An analysis of property taxes in 2025 by real estate data firm ATTOM™ shows NYC has the lowest tax rates on single-family homes in the New York–New Jersey–Connecticut tri-state area. A $750K home in Queens, for instance, might have an annual property tax bill as low as $5,850. Homes of equal value in Westchester County or New Jersey’s Essex County may carry tax bills of more than $12,000.
The city’s average effective property tax rate — the percentage of the property’s market value that a homeowner pays in taxes — is just 1.19%, which is higher than many California homes under Proposition 13, but below Chicago (2.0%), Austin (1.7%), Philadelphia (1.4%), Newark (2.0%), and Milwaukee (2.0%). The statewide New York average is 1.3%.
But don’t rest too easily. While NYC famously under-taxes single-family homes, it’s well known for overtaxing large residential buildings. That Queens single-family homeowner gets a break, but the owner of a $1.9M condo in Manhattan — the median asking price of a condo in the borough, according to the StreetEasy Data Dashboard — could be shelling out as much as $20,900 in property taxes. (Here’s how to estimate your property taxes).
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How NYC calculates property tax bills
For property tax purposes, there are four broad property classifications, only two of which are of concern to most homeowners: Class 1 properties are one- to three-family homes. Class 2 properties are rental buildings with four or more units, as well as co-ops and condos. The other classes cover utilities, commercial buildings, and other non-residential properties.
New York also has property-related taxes that kick in when a property changes hands, but these don’t fall under the general umbrella of “property taxes.” The big ones are NYC and NY state transfer taxes and the NYC mansion tax, which is ensnaring more and more buyers as the median asking price surpasses the tax’s $1M threshold in Manhattan and Brooklyn.
NYC property taxes for one- to three-family homes
Every January, the Department of Finance mails NYC homeowners a Notice of Property Value. It includes information about the property’s market value, which the city determines based on sales of nearby homes.
But homeowners pay taxes on the assessed value of a property, not its market value. In NYC, the assessed value of a Class 1 property is 6% of its market value. After determining the assessed value, the city then applies the appropriate tax rate, which is 19.843% in 2026, and can change annually. The city then multiplies the assessed value by the tax rate to come up with the effective tax on the home.
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Example: the Department of Finance estimates the market value of a Brooklyn townhouse at $1.1M, with an assessed value of $66,000. Multiply the assessed value by the 2026 tax rate, and the homeowner gets a bill of $13,096. Taxes are paid quarterly, so the first payment of $3,274 would be due on July 1 of every year.
However, many Class 1 property owners, including our Brooklyn example, end up paying less than the $13,096 estimated rate. That’s because over time, assessed values tend to lag behind market values. Since 1981, a home’s assessment can’t be raised more than 6% per year or more than 20% in any five-year period, even if the market value of the house doubles.
NYC homeowners can also enjoy a host of tax breaks and rebates, ranging from the popular Energy Star® Labeled Homes program to the 421a tax abatement. Learn about more property tax benefits for homeowners in NYC.
How are NYC condo taxes calculated?
That Brooklyn townhouse owner’s tax bill would look like a bargain compared to the owner of a condo at 15 Central Park West, where StreetEasy estimates the 2026 tax bill to be $39,576 — three times that of the Brooklyn home. As high as that is, it’s likely nowhere near what the tax would be if large Class 2 condos and co-ops were assessed and taxed like houses.
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Instead, condos and co-ops are taxed as if they’re rental buildings. The tax is based on the Department of Finance’s confusing estimate of what the building’s rental income would be based on “comparable” rental buildings. In a condo, that overall value is then allocated to the individual apartments. The result, say many critics, is that relatively modest condos are overtaxed when compared to houses, while the city’s most expensive condos are grossly under-taxed.
The Manhattan condo in our example was purchased in April 2026 for $6.995M. Applying the same formula to 15 Central Park West as the city applies to a Brooklyn townhouse, however, would result in a 2026 tax bill of about $83,341.
How are NYC co-op property taxes calculated?
Co-op owners don’t have to sweat the annual assessments and quarterly payments, since there is just one tax bill for the entire building. Individual tax liability is determined by the number of shares held, and taxes are paid with every monthly payment of maintenance fees. In January of each year, shareholders receive a tax deduction letter from their building, which lays out how much property tax they paid in the previous year.
Like a condo building, a co-op building is assessed based on its potential rental income. Take a look at 740 Park Ave. With 33 apartments at a total estimated market value of $96.5M and an assessed value of $43.4M, the annual property tax bill is roughly $4.7M — about $143,000 for each unit, or just under $12,000 a month.
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It’s unclear how the city comes up with comparable rental buildings to compare to 740 Park, because those numbers likely don’t come near what the place is really worth. One apartment in the building closed at $22M in May 2026, while the most expensive unit in the building, an 18-room duplex, sold in 2014 for $71M. Typical monthly maintenance fees, which include taxes, staff salaries, any building mortgage and upkeep, and improvements, is $17,000 or more.
A little back-of-the-envelope calculation: 33 apartments worth an average of $20M means the actual market value of the building is over half a billion ($660M)! Taxed at the Brooklyn townhouse rate, that would yield $7.86M, more than 1.5x the current tax bill.
For further comparison, let’s take a look at a far more modest 139-unit co-op at 235 E 87th Street in Yorkville. The Department of Finance estimates the building’s market value at roughly $39.7M, with an assessed value of about $17.9M. The total property tax bill is approximately $1.95M a year, or a little more than $14,000 per apartment — again, much higher than comparable homes elsewhere in the city.
Buying a home in NYC is unlike buying anywhere else. Chat with our licensed StreetEasy Concierge for a free consultation to get prepared.
