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 totaled $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, punishing lockdowns and soaring crime.
‘With this full scope of real estate activity in 2020, we can fully see the devastating economic impact the COVID pandemic has had on New York,’ said REBNY President James Whelan in a statement to DailyMail.com.
Property sales in New York City totaled $47 billion last year, down nearly half from the 2019 sales volume of $86 billion
Manhattan is seen in a view from Midtown. New York City tax revenue totaled $1.9 billion in 2020, representing a 38 percent decline from 2019
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 totaled $1.9 billion in 2020, representing a 38 percent decline from 2019, while state tax revenue from such transactions totaled $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.
Mayor Bill de Blasio has also called for federal funds to make up for the tax shortfall, and REBNY President Whelan echoed the appeal.
‘Our City and State are in dire need for the new federal administration to step in with a stimulus package – including state and local aid, rent relief and unemployment benefits – that addresses our economy and helps all New Yorkers out of this crisis,’ Whelan said.
Desperate to plug the state budget gap, Governor Andrew Cuomo has demanded a $15 billion federal bailout from President Joe Biden’s new administration
NYC property sales volume (black bars) and tax revenue (red line) is seen by month in 2020
The REBNY report is based on official data from the NYC Department of Finance’s ACRIS
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.
Cuomo’s office would say only that he would review the idea, while a spokesman for de Blasio welcomed the proposal.
‘City Hall is always looking for sensible, equitable ways to deliver more housing,’ said the spokesman, Bill Neidhardt.
The radical proposal comes as many commercial landlords in Midtown face a harsh reckoning.
The Manhattan skyline is seen above. In an ultimatum, Cuomo has already threatened to sue if Washington does not deliver the funding he is requesting
In October, only 10 percent of Manhattan office employees had returned to the workplace after fleeing in the pandemic, according to a survey from the Partnership for New York City.
What began as a stopgap measure looks increasingly like a long-term trend, as employers find that remote working has little impact on productivity and consider permanently downsizing their office footprint.
The survey found that employers expect that two out of five of employees who return to the office in 2021 will continue to work remotely at least 50 percent of the time.
Of the employers surveyed, the vast majority, 72 percent, had offices in Midtown.