New York Real Estate Market Loses $1.4B In 2020: Report

NEW YORK CITY — The state and city of New York together this year have lost an estimated $1.4 billion in tax revenue because of a decline in the real estate market throughout the coronavirus pandemic.

The data comes from a new study completed by the Real Estate Board of New York that found year-over-year investment and residential sales fell 34 percent between October 2019 and October 2020. Tax revenue from residential sales, meanwhile, fell 57 percent.

The study noted that year-to-date, investment and residential sales have totaled $34.5 billion, down approximately half from what was seen in the first 10 months of 2019.

The drop in sales paralleled a 39 percent decrease in tax revenue this year.

Real estate board president James Whelan called on the federal government to issue another stimulus package to offset the losses.

“This $1.4 billion in lost tax revenue represents another 1.4 billion reasons why the federal government must deliver a new stimulus package to help address New York’s economic crisis,” Whelan said in a statement. “As real estate market activity remains at historic lows, the negative impacts are being felt every day by millions of New Yorkers who rely on publicly funded government services that will continue to struggle without necessary tax revenue.”

The last few months of 2020, however, show a hopeful trend. Investment and residential sales in New York grew by 33 percent from September to October. In the same timeframe, tax revenue from those sales more than doubled to $108 million in October.

The real estate industry fuels New York City's economy by providing over half of the city's total annual tax revenue, the real estate board said in a release. Real estate taxes far outpace other forms of revenue including personal income tax, which accounts for 21 percent of the city's revenue.