An appeals court ruled Tuesday that a lawsuit challenging New York’s property tax system was wrongly dismissed
Attend the event July 30-August 1 at Inman Connect in Las Vegas! Seize the moment and take control of the next era of real estate. Through immersive experiences, innovative formats and an unparalleled lineup of speakers, this gathering becomes more than just a conference, it becomes a collaborative force shaping the future of our industry. Grab your tickets now! learn more.
New York’s property tax system — long considered unfair and illogical by advocates and the real estate industry — may finally be facing upheaval.
The New York State Court of Appeals issued ruling On Tuesday, real estate support group Tax Equity Now New York (TENNY) formally launched a lawsuit challenging New York City’s property tax system, but a lower court wrongly dismissed it, clearing the way for the challenge to move forward.
The lawsuit was originally filed in 2017 against the city and state in an effort to force changes through the court system. The group that filed the lawsuit, TENNY, is a consortium of homeowners, renters and housing advocacy groups who argue that New York’s current property tax system violates the Fair Housing Act because it disadvantages communities of color.
As evidence, the group pointed out that the assessed value of a property in Brooklyn’s Canarsie neighborhood, a predominantly black, working-class area, “is more expensive than in Park Slope, a predominantly white, upper-class area.” Neighborhood) three times the price of the same property” Brownstones there are worth millions of dollars. The lawsuit also offers as evidence the fact that rental building owners pay higher taxes than co-op or apartment buildings, which is one of the reasons rental prices are so high in the city.
In a 4-3 decision, the appeals court wrote that the plaintiffs had sufficiently demonstrated that the tax system was “unfair, unfair, and had a discriminatory disparate impact on certain protected classes.” They also agree that condo and co-op buildings should no longer be taxed at rates comparable to rent-stabilized apartments, a system that favors owners of expensive apartments while driving up prices for tenants and landlords.
The ruling won’t have any direct impact on New Yorkers’ property taxes, but it paves the way for the city to start making changes.
The lawsuit was initially dismissed in 2020 by a lower court, which found the system’s disparity did not violate the law. Tuesday’s decision, however, upholds many of the lawsuit’s claims and will allow the city to pursue reforms outside the courts if it chooses.
Nearly every policymaker in New York believes the city’s outdated property tax system is unfair. They differ over the best way to change it, with city and state governments arguing the issue should be addressed by local lawmakers, while advocates and real estate industry figures argue lawmakers have failed to reform the system for decades, necessitating a proposed law. challenge.
The last time New York’s property tax system was overhauled— 1981 ——is the result of litigation.
“The findings of this decision clearly demonstrate that New York City’s property tax system is discriminatory and long overdue for reform,” state Senator Andrew Gounardes, who represents the Brooklyn community, said in a statement expressed in. “New Yorkers deserve a fair property tax system that funds essential services and ensures everyone pays their fair share without unduly penalizing low-income communities who live in rental buildings and tiny homes. This is to ensure all Equity and affordability for New Yorkers.”
Email Ben Vader
