New Tax May Spur Vacant Lot Owners to Develop Housing
Mayor-elect Bill de Blasio has pledged to see through his plan to tax vacant lot owners, a move that could affect upwards of 10,000 lots throughout the city, with the highest concentration on Staten Island.
De Blasio estimates that the plan would eventually generate around $162 million annually, funding nearly 4,000 units of affordable housing. Currently, all vacant lots that are zoned residential—no matter their size or development potential—are lumped into the same category as single-family homes. This means they are assessed at 6 percent of their market value. Mr. de Blasio's plan would instead put the land in the same category as commercial properties, increasing the assessment value to 45 percent of the market value of the land over five years.
According to the Independent Budget Office, the plan will raise yearly taxes on vacant land by an average of $15,300 after five years, with the hope that the cost of inactivity will be too much to bear for many owners. In theory, this will force owners to either develop land or sell, providing the city with much-needed housing.