How property values are assessed in NYC + Great new listings with open houses from $445K

328 West 86th Street, #PHA (Compass) | https://cityrealty.com/n/I3274976

Saturday, Jun 20, 2026 By Cait Etherington

In April, Governor Kathy Hochul proposed a pied-a-terre tax on second homes in New York valued at $5 million. However, when the Department of Finance released an infographic detailing how much second homes would be taxed, it started at values of $1 million. How can that be?

The answer comes down to the homes' assessed tax value, as opposed to their actual sales value. This can be confusing to anyone who's looked at a New York City property tax bill and wondered how the city arrived at this valuation. Fortunately, in most cases, assessed tax values are much lower than current sales values; though depending on the market, the difference can vary greatly.

In 2024, for example, a Manhattan penthouse that sold for $135 million had a market value—for tax purposes—of just $4.2 million. On the flip side, the difference between the market and sales values of homes in lower-income neighborhoods is often minor. So, how did we end up with a system that not only seems nonsensical but also unfair? This article explains how properties are valued for tax purposes and why the system is currently under scrutiny.

Market Value vs. Assessed Value

When it comes to property taxes, the most important distinction to understand is the one that distinguishes market value versus assessed value. Market value is the Department of Finance’s estimate of what the property would sell for under current market conditions. Assessed value is the number used to calculate property taxes.

In many U.S. cities and regions, market and assessed values are similar. In New York City, the assessed value varies because the city applies assessment ratios, which vary by property class, to each property. In addition, state law limits how quickly residential property taxes can rise. As a result, two homes with similar market values may have shockingly different assessed values—and, by extension, tax bills—depending on their classification and assessment history.

How Market Values and Assessed Values Are Calculated

A key factor in determining property values and, by extension, assessed tax values is the property’s class. In New York City, there are four classes of property:

Class 1 includes one-, two-, and three-family homes, and very rarely exempt condos
Class 2 includes cooperatives, condominiums, and rental buildings with more than three residential units
Class 3 consists primarily of utility properties

The assessment methodology differs significantly across these categories, including between Class 1 and Class 2, even though both are residential. For Class 1, the property value is based on comparisons to other comparable home sales. For example, the assessment of a single-family home in Flushing, Queens, or Park Slope, Brooklyn, would be based on the recent sales of comparable homes in these neighborhoods. By contrast, in condos and co-ops, property values are based on the entire building, and specifically, on what the entire building would be worth if rented out (even though individual units are owned in these buildings). But this isn’t the only thing that determines how properties are ultimately assessed.

Class 1 assessments

Class 1 properties are assessed at 6 percent of their market value, so a $10 million townhouse would be valued at $600,000 for tax purposes. In addition, there are strict caps and phase-in rules—the assessed value of a class 1 property can’t increase more than 6 percent in a year, nor more than 20 percent over five years. This explains why many Park Slope brownstones, which were bought at modest prices in the 1990s but are now worth millions of dollars, are still taxed at rates that may seem more aligned with the property taxes paid on small condos in the Bronx or Queens.

Class 2 condo assessments

Class 2 condo properties are treated differently in assessments. In the case of a $10 million luxury condo, for example, the city assigns a value based on what the unit would be worth if the entire condo was rented. Under this formula, a $10 million condo may be worth only $2.5 million. Even if assessed at $2.5 million, however, the city then applies a Class 2 assessment ratio of 45 percent to the unit, which further reduces the property’s assessed value to $1.115 million. What is notable here is the condo, while holding the same sales value as a $10 million townhouse, would end up with an assessed value that is nearly twice as high.

Class 2 co-op assessments

While the assessment of condos and co-ops is similar, there is one major difference. In a condo, each owner receives a separate tax bill. In a co-op, the city sends a tax bill to the co-op, and the taxes are folded into shareholders’ fees. While this can complicated the ability to reduce property taxes based on specific situations, whether you’re in a condo or co-op, if a property is your primary residence, you are still eligible for additional property tax deductions, including STAR benefits, veterans’ exemptions, or senior benefits.

Why assessments matter

The pied-a-terre tax has called new attention to property assessments. Between July 1, 2026 to June 30, 2028, a temporary framework will be used to determine which pied-à-terre properties are subject to the new tax. In the initial phase, one- to three-family homes valued at more than $5 million will be taxed between 0.8 percent to 1.3 percent, depending on their Department of Finance-assessed value. Since most assessed values are well below sales values, it goes without saying that few one- to three-family homes will be impacted by this new law. By contrast, condo and co-op units with Department of Finance-assessed values of $1 million or more will be subject to the new tax, with rates between 4 percent and 6.5 percent. Most lawmakers assume this will mean that only condos that would sell for $5 million or more in the current market will be subject to the new tax.

Pied-a-terre tax details (New York Department of Finance)

Starting on July 1, 2028, and continuing until June 30, 2031, however, an entirely different valuation model will apply to all residential units. The key difference is that starting on July 1, 2028, condos and co-ops will no longer be valued based on a hypothetical scenario that treats them as potential rental units in a larger building but rather on the same basis as one- to three-family homes (that is, on their potential sales value). Under this model, all pied-à-terre properties with an assessed value exceeding $5 million will be subject to a tax of 0.8 percent to 1.3 percent, depending on their value.

At any time, property assessments directly affect the cost of living in New York City. They also can, at times, affect the ability of current owners to hold on to longstanding family homes.

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Still confused, or want to dispute your property's assessed value?

Property tax valuations in New York City are difficult to understand—so much so that the Department of Finance publishes a glossary of assessment-related terms on its website. Fortunately, the Department of Finance strives to be as transparent as possible and even offers an opportunity to contest assessments that seem unfair. If you want to challenge your assessed property value, visit the NYC Department of Finance. The deadline to dispute an assessed property value on a Class 1 property is March 15. For Class 2, 3, and 4 properties, you must file by March 1.

Select Open Houses Sunday, June 20, 2026

807 Riverside Drive, #1I
$445,000

Washington Heights | Condominium | 1 Bedroom, 1 Bath

Open House: Sunday, June 21, 2026

807 Riverside Drive, #1I (Douglas Elliman Real Estate -)

From the Listing: PERCHED ATOP OF A HILL AND ELEVATED ABOVE STREET LEVEL (see photos), this beautifully renovated one-bedroom residence enjoys sunny southern exposure, open-sky views, and tranquil treetop vistas overlooking neighboring townhouses. Although designated as Apartment 1I, the home feels far removed from a typical first-floor setting. See floor plan and full details here.

London Terrace Towers, #6I
$650,000

Chelsea | Cooperative | Studio, 1 Bath

Open House: Sunday, June 21, 2026

London Terrace Towers, #6I (Serhant)

From the Listing: Welcome to Apartment 6I at 405 West 23rd Street. This is the most beautifully conceived alcove studio at London Terrace Towers, and a true testament to what thoughtful design can do with space. Perfectly balancing prewar character with a fresh, designer renovation, Residence 6I is a reimagined alcove studio that lives far larger than its footprint. Thoughtfully configu red with distinct spaces for living, dining, sleeping, and working, this turnkey home offers an elevated lifestyle in one of Chelsea's most iconic full-service cooperatives. See floor plan and full details here.

Sutton55, #11F
$795,000

Midtown East | Cooperative | 1 Bedroom, 1 Bath | 825 ft²

Open House: Sunday, June 21, 2026

Sutton55, #11F (Next Stop NY)

From the Listing: Sun-Drenched City Views, Flexible Living, and a Prime Sutton Place Location Welcome to Apartment 11F, a bright and spacious convertible two-bedroom home with spectacular open city views, abundant natural light, including views of the iconic Chrysler Building. This oversized Junior 4 offers exceptional versatility. Currently configured with a separate dining area, the windowed alcove can easily be transformed into a second bedroom, home office, or guest room-just as many residents in the building have done. See floor plan and full details here.

328 West 86th Street, #PHA
$849,000

Riverside Dr./West End Ave. | Cooperative | 1 Bedroom, 1 Bath

Open House: Sunday, June 21, 2026

328 West 86th Street, #PHA (Compass)

From the Listing: Sunny & Quiet Penthouse Views with Wrap-Around Terrace for One-of-a-Kind Upper West Side Living! Top-floor corner 1BR with 12 windows facing East, South, and West — and a sweeping wrap-around terrace with unobstructed city and river views that have to be seen to be believed. See floor plan and full details here.

The Kenilworth, #7C
$949,000

Carnegie Hill | Cooperative | 1 Bedroom, 1 Bath

Open House: Sunday, June 21, 2026

The Kenilworth, #7C (Douglas Elliman Real Estate -)

From the Listing: BRAND NEW Sunkissed, tranquil, meticulously renovated convertible 2-bedroom home in the very desirable Kenilworth in the heart of the Upper East Side. This mint apt features a generous and gracious layout, stunning light with East and North views, beautiful wide plank floors, custom lighting, window treatments, doors and carpentry plus fitted closets for storage galore! See floor plan and full details here.

407 West 40th Street, #5A
$975,000

Midtown West | Cooperative | 2 Bedrooms, 2 Baths

Open House: Sunday, June 21, 2026

407 West 40th Street, #5A (Corcoran Group)

From the Listing: Bright and spacious two-bedroom, two-bath duplex with two levels of private outdoor space, including a sprawling roof deck and terrace with open city views and breathtaking sunset exposure. Located on the top floor of a boutique, well-maintained co-op, this sun-drenched home offers the perfect blend of indoor comfort and outdoor living in one of Manhattan's most exciting neighborhoods near Hudson Yards. See floor plan and full details here.

The Santa Monica, #4E
$975,000

Riverside Dr./West End Ave. | Cooperative | 2 Bedrooms, 1 Bath

Open House: Sunday, June 21, 2026

The Santa Monica, #4E (Compass)

From the Listing: Welcome to comfort. Welcome to location. Welcome to quiet elegance. Here’s a rare, ready to impress, renovated residence that’s perfectly poised for move-in day.With Central AC and a peaceful, bright position in its sweet, pet-friendly, elevator building (with live-in Super and bike/laundry/storage rooms), this stylish beauty is a residential standout. Created for easy living and comfortable entertaining, this feel-good find is a treasure in its boutique, pre-war building whose prime, Riverside Park-block location comes with bragging rights. Want split bedrooms with ample designer closets? Check. See floor plan and full details here.

The Elliot, #10G
$999,000

Riverside Dr./West End Ave. | Cooperative | 2 Bedrooms, 1 Bath

Open House: Sunday, June 21, 2026

The Elliot, #10G (Digs Realty Group LLC)

From the Listing: Nestled on a picturesque tree-lined park block, this bright and airy corner 2-bedroom residence boasts sweeping open city and partial river views, high ceilings and timeless charm. With both southern and eastern exposures, the home is filled with natural light throughout the day. The thoughtfully designed layout offers generous proportions where they matter most, featuring an oversized living room, separate dining area, and exceptional closet space throughout. The sunken living room is framed by a wall of south-facing windows and enhanced by 9.5-foot beamed ceilings, creating a combination of space and character that is hard to find. See floor plan and full details here.

Sutton House, #3EB
$1,095,000

Beekman/Sutton Place | Cooperative | 2 Bedrooms, 2 Baths | 1,400 ft²

Open House: Sunday, June 21, 2026

Sutton House, #3EB (Stephen P Wald Real Estate Associates Inc)

From the Listing: Enjoy the light, space, and charming treetop views in this wonderfully laid-out two-bedroom residence at Sutton House. Step out onto your own private balcony to enjoy a morning coffee or evening relaxation, overlooking the beautifully landscaped courtyard. The thoughtful floor plan features split corner bedrooms, providing excellent privacy and natural light throughout. See floor plan and full details here.

11 Sterling Place, #5F
$1,450,000

Park Slope | Condominium | 2 Bedrooms, 1 Bath | 960 ft²

Open House: Sunday, June 21, 2026

11 Sterling Place, #5F (Brown Harris Stevens Brooklyn LLC)

From the Listing: The coveted top-floor, corner condominium at 11 Sterling Place is on the market for the first time in over 25 years. This 960 square foot loft space is bathed in sunlight all day long by 10 oversized windows with southern and western exposures. With ceilings that soar to 12 feet, the airiness of the space is unique for Park Slope. Currently configured as a spacious 2-bedroom, the apartment can be easily converted to a large 1-bedroom, or a completely open loft. See floor plan and full details here.

Cannon Point North, #11M
$1,495,000 (-3.5%)

Beekman/Sutton Place | Cooperative | 2 Bedrooms, 2 Baths

Open House: Sunday, June 21, 2026

Cannon Point North, #11M (Compass)

From the Listing: Bring your vision to Residence 11M, an expansive, sun-drenched 2-bedroom, 2-bathroom home perched on the 11th floor. Boasting sweeping, direct views of the East River, this highly sought-after M-line layout offers exceptional proportions. The home features a proper entry foyer, an oversized living room bathed in eastern light, and a dedicated formal dining area. Both bedrooms are generous in size, including a king-sized primary suite with an en-suite bath. With its gracious footprint, 11M is the perfect canvas to design your dream home. See floor plan and full details here.

305 West 86th Street, #4B
$1,500,000

Riverside Dr./West End Ave. | Cooperative | 2 Bedrooms, 2 Baths

Open House: Sunday, June 21, 2026

305 West 86th Street, #4B (Compass)

From the Listing: Live amongst the treetops in this gracious move-in-ready 2-bedroom, 2-bathroom pre-war classic moments from Riverside Park and all the wonderful aspects of the Upper West Side lifestyle. See floor plan and full details here.

The New York Towers, #20B
$1,700,000

Gramercy Park | Cooperative | 2 Bedrooms, 1.5 Baths | 1,200 ft²

Open House: Sunday, June 21, 2026

The New York Towers, #20B (Nardoni Realty Inc)

From the Listing: Welcome to the ultimate NYC home with skyline views from your own private terrace – with a private outdoor space – overlooking all of Manhattan – with beautiful sunlight throughout the day and gorgeous sunsets.With the terrace space this unit comes in at over 1700 sf! Step out into sunshine with the stunning views spanning all the way from south and Downtown to north, west and east- panoramic views including the iconic buildings of NYC! See floor plan and full details here.

The Clinton, #5B
$1,780,000

Riverside Dr./West End Ave. | Cooperative | 2 Bedrooms, 2 Baths

Open House: Sunday, June 21, 2026

The Clinton, #5B (Brown Harris Stevens Residential Sales LLC)

From the Listing: Filled with natural light, this inviting, quintessential Classic 6 prewar home offers a flexible two- or three-bedroom layout that can easily adapt to your changing needs and lifestyle. Ready for your personal touch, the home is currently configured with two spacious bedrooms, a generous living room, and a formal dining room, creating an ideal setting for both everyday living and entertaining. See floor plan and full details here.

16 Wyckoff Street, #4
$1,795,000

Boerum Hill | Cooperative | 2 Bedrooms, 2 Baths

Open House: Sunday, June 21, 2026

16 Wyckoff Street, #4 (Compass)

From the Listing: Welcome to 16 Wyckoff Street, a home so thoughtfully designed and perfectly positioned you may never want to leave. Set within a grand, 25-foot wide townhouse at the vibrant intersection of Cobble Hill and Boerum Hill, this top-floor residence underwent a meticulous, down-to-the-studs gut renovation in 2021, blending modern luxury with classic Brooklyn soul. See floor plan and full details here.

CitySpire, #4103
$1,795,000 (-4.3%)

Midtown West | Condominium | 2 Bedrooms, 2.5 Baths | 1,172 ft²

Open House: Sunday, June 21, 2026

CitySpire, #4103 (Compass)

From the Listing: A mint condition, modern yet classic renovation within the renowned CitySpire is a true rarity. This split 2-bedroom, 2.5-bathroom residence has north and east exposures and iconic skyline views and a peek of Central Park from the 41st floor, further elevated by exquisite finishes throughout. See floor plan and full details here.

176 West 87th Street, #5C
$1,995,000

Broadway Corridor | Cooperative | 2 Bedrooms, 1.5 Baths

Open House: Sunday, June 21, 2026

176 West 87th Street, #5C (Compass)

From the Listing: Rarely available and impeccably renovated, this mint condition 2 bedroom, 1.5 bath corner home sits high above West 87th and Amsterdam, where oversized windows facing west and north pour light into every room all day long. Open views up Amsterdam Avenue, prewar bones, and a renovation where no expense was spared and no detail overlooked. This is the one buyers wait years for. See floor plan and full details here.

Sheffield 57, #22S
$2,050,000

Midtown West | Condominium | 2 Bedrooms, 2 Baths | 1 ft²

Open House: Sunday, June 21, 2026

Sheffield 57, #22S (Brown Harris Stevens Residential Sales LLC)

From the Listing: This beautiful and immaculate two bedroom, two bath home is flooded with light all day. It is a SPACIOUS corner apartment facing south and east, with open, unobstructed and protected views. The apartment design is perfect for entertaining, The chef's kitchen features expansive Calacatta marble counter-tops, custom Italian cabinetry and Miele, Bosch and Sub-zero appliances.Yes, there is a washer and dryer too! Both bathrooms include soaking tubs and pedestal sinks, and you will feel like you're being pampered with its honed travertine floors, walls and counters. See floor plan and full details here.

230 Riverside Drive, #17D
$2,150,000

Riverside Dr./West End Ave. | Condominium | 3 Bedrooms, 2 Baths | 1,500 ft²

Open House: Sunday, June 21, 2026

230 Riverside Drive, #17D (Compass)

From the Listing: Take in Stunning Hudson River Views in every room! Prime living in the gut-renovated 3-bedroom, 2-bath home with panoramic river views. Walking into the apartment, you’re immediately wowed by the high ceilings, open views, and dark walnut hardwood floors. With eleven large windows and three different exposures, including South, this home is filled with natural light. See floor plan and full details here.

333 East 57th Street, #4A
$2,500,000

Midtown East | Cooperative | 4 Bedrooms, 4 Baths | 3,000 ft²

Open House: Sunday, June 21, 2026

333 East 57th Street, #4A (Corcoran Group)

From the Listing: Unit 4A at 333 East 57th Street is a grand nine-room, four-bedroom, four-bathroom prewar cooperative apartment on a beautiful tree-lined residential block in Sutton Place. Designed in 1928, it carries the proportions and quiet confidence of a bygone era, dual exposures pulling light through the home from morning to afternoon, tall ceilings and scale that feel impossible to find today. This is the kind of home people spend years searching for. See floor plan and full details here.

799 Park Avenue, #8A
$4,200,000

Park/Fifth Ave. to 79th St. | Cooperative | 3 Bedrooms, 3 Baths

Open House: Sunday, June 21, 2026

799 Park Avenue, #8A (Douglas Elliman Real Estate -)

From the Listing: A Rare Park Avenue Classic Six - Graciously Proportioned, Thoughtfully Reimagined. Perfectly positioned on the eighth floor of one of Park Avenue's most established cooperatives, Residence 8A is a beautifully renovated Classic Six that seamlessly blends timeless Manhattan elegance with the comforts of modern living. Offering three bedrooms, three full bathrooms, a formal dining room, a home office or media room, a custom eat-in kitchen, and a gracious entry foyer and gallery, the home is defined by an extraordinary sense of scale rarely found today. See floor plan and full details here.

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Contributing Writer Cait Etherington Cait Etherington has over twenty years of experience working as a journalist and communications consultant. Her articles and reviews have been published in newspapers and magazines across the United States and internationally. An experienced financial writer, Cait is committed to exposing the human side of stories about contemporary business, banking and workplace relations. She also enjoys writing about trends, lifestyles and real estate in New York City where she lives with her family in a cozy apartment on the twentieth floor of a Manhattan high rise.

Read Full Bio | Contact Cait Etherington

In this article:

Market Value vs. Assessed Value

How Market Values and Assessed Values Are Calculated

Class 1 assessments

Class 2 condo assessments

Class 2 co-op assessments

Why assessments matter

Select which properties are of interest to you:

Still confused, or want to dispute your property's assessed value?

Select Open Houses Sunday, June 20, 2026

807 Riverside Drive, #1I
$445,000

London Terrace Towers, #6I
$650,000

Sutton55, #11F
$795,000

328 West 86th Street, #PHA
$849,000

The Kenilworth, #7C
$949,000

407 West 40th Street, #5A
$975,000

The Santa Monica, #4E
$975,000

The Elliot, #10G
$999,000

Sutton House, #3EB
$1,095,000

11 Sterling Place, #5F
$1,450,000

Cannon Point North, #11M
$1,495,000 (-3.5%)

305 West 86th Street, #4B
$1,500,000

The New York Towers, #20B
$1,700,000

The Clinton, #5B
$1,780,000

16 Wyckoff Street, #4
$1,795,000

CitySpire, #4103
$1,795,000 (-4.3%)

176 West 87th Street, #5C
$1,995,000

Sheffield 57, #22S
$2,050,000

230 Riverside Drive, #17D
$2,150,000

333 East 57th Street, #4A
$2,500,000

799 Park Avenue, #8A
$4,200,000

Swim with a View: 30 Manhattan buildings with high-floor swimming pools and fitness centers

Top 10 condos in Turtle Bay and Beekman-Sutton Place + New developments and price-reduced listings

Seven tips for getting past NYC's toughest co-op boards + Prewar gems with open houses

Pre-war vs. Post-war: Pros, cons, and featured listings

How historic districts impact property values and affordability + Charming NYC homes in landmarked properties

See 20 Flatiron-style buildings and their availabilities as Landmarks tables "spaceship-like" addition in Meatpacking

When, why, and how to hire a home inspector + Great new listings with outdoor space from $595K

Top 10 Park Avenue buildings + Beautiful listings on New York's greatest residential boulevard

How property values are assessed in NYC + Great new listings with open houses from $445K

In this article:

Market Value vs. Assessed Value

How Market Values and Assessed Values Are Calculated

Class 1 assessments

Class 2 condo assessments

Class 2 co-op assessments

Why assessments matter

Select which properties are of interest to you:

Still confused, or want to dispute your property's assessed value?

Select Open Houses Sunday, June 20, 2026

Select which properties are of interest to you:

Listings in this article

Tags:

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Seven tips for getting past NYC's toughest co-op boards + Prewar gems with open houses

See 20 Flatiron-style buildings and their availabilities as Landmarks tables "spaceship-like" addition in Meatpacking

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