New York’s Tax Revenue Generated by Investment and Residential Sales in April 2020 Down Nearly 48% Compared to 2019; Down 64% from March 2020
The Real Estate Board of New York (REBNY), the City’s leading real estate trade association, today reported that tax revenue generated from investment and residential sales in New York City and New York State decreased by 48% from April 2019 to April 2020, and 64% from March 2020 to April 2020. These decreases represent a nearly $72 million loss in tax revenue for the City and State year over year, and a $139 million decrease from month to month.
REBNY created a new Monthly Investment and Residential Sales Report, released today, to track and quantify the impact of the Coronavirus (COVID-19) crisis on the City and the State’s ability to generate taxes needed for essential government services.
“This dramatic loss in tax revenue is alarming,” said REBNY President James Whelan. “The real estate sector is the City’s economic engine. The pandemic has caused that engine to stall and we should expect such alarming trends to carry through May and June in the best-case scenario.”
The real estate industry, which serves as the fundamental driver of New York City’s economy, represented more than half (53%) of the City’s total annual tax revenue in the last fiscal year, which is more than double the next closest contributor – personal income tax, which accounts for 21% of the City’s annual tax revenue. The industry employs hundreds of thousands of New Yorkers from building service workers to brokers and generates essential revenue for the City of New York to maintain the salaries of first responders, fund infrastructure improvements and provide for public services like schools, libraries and parks.
Other key findings from REBNY’s special report on investment and residential sales include:
From April 2019 to April 2020, total residential sales and transactions declined, resulting in a 30% decrease in tax revenue. This represents a combined loss of $25 million in tax revenue at the City and State level compared to the previous year.
From April 2019 to April 2020, total investment sales and transactions declined, resulting in a 71% decrease in tax revenue. This represents a combined loss of more than $46 million in tax revenue at the City and State level.
REBNY’s Monthly Investment and Residential Sales Report is a compilation of transaction activity for both investment sales and residential sales in New York City and New York State. REBNY is tracking all revenue generated by each asset class and transaction on a monthly basis to monitor changes as a result of the Coronavirus crisis. The report is an analysis of 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.
Download REBNY’s Monthly Investment and Residential Sales Report here. For more information about REBNY research reports, visit go.rebny.com/Reports.
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ABOUT THE REAL ESTATE BOARD OF NEW YORK
The Real Estate Board of New York (REBNY) is the City’s leading real estate trade association. Founded in 1896, REBNY represents commercial, residential, and institutional property owners, builders, managers, investors, brokers, and salespeople; banks, financial service companies, utilities, attorneys, architects, and contractors; corporations, co-partnerships, and individuals professionally interested in New York City real estate. REBNY conducts research on various civic matters including tax policy, city planning and zoning, rental conditions, land use policy, building codes, and other city, state, and federal legislation. REBNY regularly publishes market data, policy reports, and broker surveys. In addition, REBNY provides for its members: informational, technical, and technological resources; networking and charitable service opportunities; qualifying and continuing education courses; professional education programs, seminars, and designations; career-changing awards; legal advice; and a wide range of additional member benefits. For more information, please visit www.REBNY.com.