Second Homes, New Taxes: How Local Governments Are Rewriting the Wealth Planning Map
This summer, those with vacation homes in New York City may have received letters in the mail from the city. Those letters are the first wave of enforcement for a new pied-à-terre surcharge that took effect July 1, 2026. Here’s how it works: if a household owns a home in the city worth $5 million or more and doesn’t use it as a primary residence, the city adds an annual surcharge on top of the regular property tax bill. Condos and co-ops currently trigger the surcharge at a much lower $1 million threshold, not because the policy targets smaller units, but because the city’s valuation method for those properties runs well below true market value; a $1 million “city value” condo may really be worth $5 million on the open market. The rules run for five years before they’re set to expire.
Equity Markets Not Fearful of Fed or Yields, Yet…
Last week, the major U.S. stock indexes finished mixed. The Federal Reserve announced its first rate hike since 2023, and oil prices bounced around due to Middle East headlines. Artificial intelligence (AI)-related stocks largely ignored the warnings about the “end of humanity” and the need to “slow down” from various AI thought leaders. The Nasdaq Composite Index outperformed last week. Growth stocks outpaced value in the large-cap Russell 1000 Index universe, while the small-cap Russell 2000 Index lagged.
Economic Commentary: The Benefit of a Clear Mind and Strong Stomach
Every home realtor knows that a 7% mortgage rate is the kiss of death. Stock market savants know that a 5% 10-year Treasury yield is a tipping point. Lots of economists know that trade wars cause recessions. And now we are told, with a certain amount of qualified certitude, that AI could/will kill us. In all of this, it becomes extremely important to ask “Why?” or “How?”. The answer is frequently based on perceptions of historical reality, which should be tempered with the knowledge that history is a guide, not an oracle.