The report from the Real Estate Board of New York estimated that New York City and state collectively lost $1.6 billion in tax revenue in 2020 due to declines in real estate market activity
Property sales in New York City plunged 46 percent in 2020 from the prior year’s level, costing $1.6 billion in lost city and state tax revenue, according to an industry group.
The report on Friday from the Real Estate Board of New York said that property sales in the city totalled $47 billion last year, down nearly half from the 2019 sales volume of $86 billion.
The steep decline in real estate transactions came as residents fled the city in a mass exodus amid pandemic fears, lockdowns and soaring crime.
The report estimated that New York City and state collectively lost $1.6 billion in tax revenue in 2020 due to these significant declines in real estate market activity.
New York City tax revenue from real estate transactions totalled $1.9 billion in 2020, representing a 38 percent decline from 2019, while state tax revenue from such transactions totalled $785 million in 2020, a 32 percent drop.
The real estate industry generates more than half of New York City’s total annual tax revenue, while personal income tax accounts for just one-fifth of tax receipts.
Desperate to plug the state budget gap, Governor Andrew Cuomo has demanded a $15 billion federal bailout from President Joe Biden’s new administration.
In an ultimatum, Cuomo has already threatened to sue if Washington does not deliver the funding he is requesting.
The REBNY report is based on official data from the NYC Department of Finance’s Automated City Register Information System (ACRIS) and captures total sales volume, number of transactions and tax revenue.
Last month, the group, whose members include nearly every major landlord and developer in the city, proposed dramatic changes to zoning rules to convert Midtown office buildings into apartments, according to the New York Times.
