Feb 19, 2026
New York City homeowners could be on the hook for higher property taxes next year if state lawmakers reject Mayor Zohran Mamdani’s push to raise taxes on the city’s wealthiest residents.
In his first budget proposal since taking office, Mamdani warned February 17 that the city may raise property taxes by as much as 9.5% to help close a projected $5.4 billion budget shortfall (1).
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He framed the increase as a last resort and argued it might be avoided if Albany approves a proposed income tax hike on New Yorkers earning $1 million or more.
“If we cannot follow this first path, we will be forced onto a much more damaging path of last resort, one where we have to use the only tools at the city’s disposal: raising property taxes and raiding our reserves, " he said. “The second path is painful.”
But how does it impact regular New Yorkers?
The budget math behind a possible property tax hike
Mamdani’s preliminary budget outlines $127 billion in spending. That’s roughly $5 billion more than the current plan and, by law, must be balanced.
The proposal, set to take effect July 1, lays out how limited the city’s options are without new revenue. It’s a constraint Mamdani has attributed to the budgetary decisions of the previous administration.
Property taxes play an outsized role because they are the city’s largest source of revenue and the only major tax New York City can raise on its own. Mamdani said a 9.5% increase could generate roughly $3.7 billion.
He emphasized that tax hikes are the last resort, saying the budget is designed to pressure state leaders to approve higher taxes on the city’s wealthiest residents. Without Albany’s approval, Governor Kathy Hochul included, he argues the city would be left with little choice but to raise taxes or tap reserve funds meant for economic downturns.
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"This is a preliminary budget," he said at a February 17 press conference. "This is a budget that reflects the only tools that the city has at its disposal."
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Where the State stands
Hochul, who is up for reelection this year, has pushed back on a tax increase for high earners, questioning whether it’s necessary to close the gap.
“I don’t know that that’s necessary, but let’s find out what is really necessary to close that gap,” she said during her own press conference in Manhattan (3).
While New York City hasn’t raised property taxes since the late 2000s, homeowners in the state already pay among the highest property tax bills in the country. New York’s effective property tax rate is about 1.45%, nearly double the national average of 0.89%, with a median annual bill exceeding $6,542, according to SmartAsset (4).
A 9.5% increase would push that median bill to just over $7,160, meaning the typical homeowner could pay more than $600 extra per year.
Any property tax hike would still require City Council approval, and resistance is already emerging. Council Speaker Julie Menin, a more moderate Democrat, has aligned with Governor Kathy Hochul in opposing the proposal.
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“At a time when New Yorkers are already grappling with an affordability crisis, dipping into rainy day reserves and proposing significant property tax increases should not be on the table whatsoever,” the speaker said in a joint statement with Council Member Linda Lee (5).
How to plan for rising property taxes
Across the country, property taxes have been climbing faster than many homeowners expect. Between 2019 and 2024, Americans saw their property tax bills rise by roughly 27.4%, and about two-thirds of homeowners say their most recent bill came in higher than anticipated, according to research from CoreLogic (6).
A homeowner’s property tax bill usually comes down to two things: how much the home is assessed for and the tax rate set by the state or local government. But higher home prices don’t always mean higher taxes. Some states with lower-priced homes charge higher rates, while more expensive markets may have caps, exemptions or assessment rules that help keep tax bills from rising as quickly.
That complexity can make it harder for homeowners to spot errors. While nearly half of homeowners say their home’s assessed value isn’t accurate, roughly 8 in 10 have never appealed their property tax bill, often because they didn’t realize they had the right to do so. If you believe your assessment doesn’t reflect your home’s true market value, filing an appeal could help limit future increases.
Experts say it also helps to think ahead, especially if you’re buying or planning a move. Looking at a home’s past property tax bills can give you a clearer sense of what you might actually pay. Checking whether a town’s tax base is growing or shrinking can signal whether rates are likely to rise.
Knowing when the next reassessment is scheduled can also help you avoid an unwelcome surprise after closing. And if you’re considering a move to another state, comparing property tax rates, not just home prices, can make it easier to plan for what your housing costs will look like over time.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
New York Times (1); New York City (2); Realtor (3); Smart Asset (4); Politico (5); Core Logic (6).
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Victoria Vesovski is a Toronto-based Staff Reporter at Moneywise, where she covers the intersection of personal finance, lifestyle and trending news. She holds an Honours Bachelor of Arts from the University of Toronto, a postgraduate certificate in Publishing from Toronto Metropolitan University and a Master’s degree in American Journalism from New York University’s Arthur L. Carter Journalism Institute. Her work has been featured in publications including Apple News, Yahoo Finance, MSN Money, Her Campus Media and The Click.
