International · Sep 2026

New York’s pied-à-terre tax: what international buyers need to know.

Since 1 July 2026, non-primary residences in New York City carry a new annual tax. Combined with fewer foreign buyers nationwide, it changes the math for overseas purchasers.

Gavin Hammon
Licensed Associate Real Estate Broker, Compass · 5 min read

For overseas buyers, New York has always been a long-term store of value. Two things changed in 2026.

1. A new annual tax on second homes

The state budget passed at the end of May created an annual tax on non-primary residences in New York City, effective 1 July 2026. It is charged on the Department of Finance market value, not the purchase price: for condos and co-ops, 4% from $1 million, 5.25% from $3 million and 6.5% above $5 million of DOF value; one- to three-family homes pay lower rates from $5 million. The first charge appears on the January 2027 property tax bill. Speak to a tax advisor before you buy. I will introduce you to one.

2. Fewer foreign buyers, but they pay cash

According to the National Association of Realtors, foreign buyers purchased $45.3 billion of US homes between April 2025 and March 2026, down 19.1%. Canada (16%), Mexico (14%) and China (11%) led. For the first time, New York was not among the top five states. But 48% of foreign buyers paid all cash, compared with 28% of all buyers.

Fewer international buyers means less competition for the ones who still come, and more negotiating room.

3. Entity purchases: rules in flux

FinCEN’s rule requiring reports on all-cash residential purchases by LLCs, corporations and trusts took effect on 1 March 2026, but a federal court in Texas vacated it nationwide on 19 March 2026, and FinCEN currently requires no reports while the government appeals. Many international buyers use exactly those structures, so the status needs to be checked at the time of every offer.

What this means

Primary-residence buyers (relocating executives, families) are unaffected by the new tax.
Second-home buyers should model the annual tax into total cost of ownership.
Sellers of homes that traditionally attract overseas buyers should widen their marketing to domestic cash buyers too.

If you own in New York: if your buyer pool is traditionally international, your marketing plan needs to change in 2026. Request a private valuation →

Sources: NAR 2026 International Transactions report (29 Jul 2026); NYC Department of Finance (pied-à-terre tax); FinCEN on the status of the residential real estate rule. Not tax or legal advice.