Jan 4, 2020

New York City's mansion tax impacts housing cost

Manhattan sunset, seen in September from Arthur Ashe Stadium in Queens, home of the U.S. Open. Photo: TPN/Getty Images

The average price of a Manhattan co-op or condo fell to $1.8 million in the fourth quarter of 2019, according to Douglass Elliman, the largest real estate brokerage in the New York City area, the Financial Times reports.

Why it matters: "The Manhattan property drop is in sharp contrast to the rally on Wall Street, where stock markets have hit new records."

  • The price per square foot declined 6.1 per cent to $1,581.

What's happening: New York City's mansion tax, which took effect July 1, "levied a sliding scale of charges on apartments selling for more than $1m."

  • "Trump’s tax law limited the amount of state and local taxes households could deduct from their federal taxes."
  • That "has been blamed for spurring a flight by wealthy New Yorkers to Florida, which has no personal income tax."

Younger buyers still flooded into Brooklyn and Queens, and sought out studios and one-bedrooms in Manhattan, the FT added.

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Bloomberg pitches raising $5 trillion by taxing the wealthy

Bloomberg in D.C. on Jan. 30. Photo: Mark Wilson/Getty Images

Michael Bloomberg proposed generating roughly $5 trillion for education, infrastructure and climate change by hiking the tax rates of top earners and corporations in a plan released Saturday.

Why it matters: That $5 trillion goal beats former Vice President Joe Biden's plan to raise $3.2 trillion over a decade by increasing taxes, Sen. Elizabeth Warren's "ultra-millionaire tax" to bring in nearly $4 trillion, and just surpasses Sen. Bernie Sanders' plan to raise roughly $4.35 trillion by taxing the wealthy.

The housing market faces an uncertain 2020

Illustration: Aïda Amer/Axios

After being one of the weaker sectors of the U.S. economy in the first half of 2019, the housing sector rebounded, spurred by a trio of U.S. interest rate cuts from the Fed that lowered the cost of mortgages.

Yes, but: There are clouds on the horizon for 2020, as declining home affordability continues to be a concern, especially for first-time home buyers.

Go deeperArrowJan 23, 2020

Company tax incentives don't spur economic growth

Illustration: Sarah Grillo/Axios

More than two years after Amazon announced its search for a second headquarters and cities around the U.S. bent over backwards to offer the megacompany as much free cash and incentives as they could, new research confirms what economists have been saying for years: Such programs are a waste of money.

Driving the news: A paper from researchers at Princeton and Columbia Business School found "no evidence" that business tax incentives given to individual companies increased broader economic growth at the state and local level.

Go deeperArrowJan 7, 2020