Housing and Urban Development Secretary Scott Turner is warning that New York City Mayor Zohran Mamdani’s threatened property tax hike will have immediate consequences for renters and working families. Speaking Thursday on “The Alex Marlow Show,” Turner said the math is straightforward.
“Rents are going to go up. You’re going to see people who are going to be out of housing, not be able to afford rents. Housing costs will go up,” Turner said.
Turner’s comments come as Mamdani pushes a $127 billion city budget and pressures Albany to raise taxes on millionaires. The mayor has said that if Gov. Kathy Hochul and the state Legislature refuse to approve a “rich tax,” he will be “forced” to increase property taxes by 9.5% across the board.
“There are two paths to bridge the city’s inherited budget gap,” Mamdani said in his budget presentation. “The first path is the most sustainable and fairest: raising taxes on the wealthiest and corporations.”
“If we do not go down the first path,” he continued, “the city will be forced to go down a second, more harmful path of property taxes and raiding our reserves.”
While homeowners may appear to be the first in line to absorb the increase, housing analysts say renters are likely to feel the impact quickly — particularly in a market already defined by low vacancy and rising costs.
According to New York City Department of Finance data for fiscal year 2027, rental properties across the five boroughs are currently taxed at an average effective rate of roughly 12.4%. If that rate were increased by 9.5%, the effective rate would rise to about 13.6%.
On a per-unit basis, the average property tax for a rental unit is estimated at $5,886. A 9.5% increase would push that figure to approximately $6,445 per unit — an increase of roughly $560 per apartment.
For landlords operating dozens of units, that additional carrying cost can quickly multiply. In a market-rate building, owners may attempt to pass at least part of that burden onto tenants through higher renewal rates or increased listing prices.
New York City rents are already up 6.6% year-over-year, according to Realtor.com data, with vacancy rates hovering near 1.4% — historically low. Nearly 90% of renters remained in place last year, limiting available inventory and concentrating demand on the few units that come to market.
Economists warn that when operating costs rise in a tight rental market, landlords retain pricing leverage.
Even in rent-stabilized buildings, where annual increases are capped, property tax hikes can create financial strain. Owners facing higher fixed costs may reduce building services or defer maintenance to balance budgets.
Landlord groups say Mamdani’s proposal could accelerate distress among smaller property owners.
Small Property Owners of New York warned that the proposed increase could be the “final nail in the coffin” for mom-and-pop landlords operating rent-stabilized buildings. Critics argue that rising taxes combined with rent freeze policies would make it difficult to maintain older buildings, potentially pushing owners to sell to larger corporate entities or developers.
Mamdani has also appointed six new members to the city’s Rent Guidelines Board, which sets allowable rent increases for nearly one million rent-stabilized apartments. A central plank of his campaign was a promise to “freeze the rent” on those units.
HUD Secretary Turner framed the issue in national terms, arguing that housing affordability cannot be addressed by raising operating costs.
When property taxes rise, Turner suggested, the consequences ripple outward — from landlords to tenants to neighborhoods.
“Rents are going to go up,” he said again. “You’re going to see people who are going to be out of housing.”
As Albany considers whether to raise income taxes on high earners and the city weighs its next fiscal move, Turner’s warning underscores the broader stakes: in one of the tightest housing markets in the country, any added cost may be felt first — and hardest — by renters.