‘The Stupidest Policy I’ve Ever Seen in Real Estate’ [WATCH]

New York City Mayor Zohran Mamdani announced a new tax targeting high-value properties owned by non-residents, prompting criticism from investor Kevin O’Leary, who said the policy could drive investment away from the city.

Mamdani outlined the measure as part of his broader policy agenda, describing it as a new approach to taxing high-end real estate holdings.

“When I ran for mayor, I said I was going to tax the rich. Well, today we’re taxing I’m thrilled to announce we’ve secured a peer to tear tax the first in New York’s history. This is an annual fee on luxury properties worth more than $5 million whose owners do not live full time in the city.”

The policy, referred to as a tax on pied-à-terre properties, would apply to residences valued above $5 million when owned by individuals who do not reside in New York City full time. The measure represents a new category of taxation intended to capture revenue from properties that are not primary residences.

O’Leary, speaking in response to the announcement, said similar tax policies in other states have already contributed to shifts in where individuals choose to live and invest.

“Yeah, it is, I think what happens here? And it’s been going on for a few years in states like New York, Massachusetts, New Jersey is when you tax people past 50% pretty well in any tax bracket, as they move towards retirement into their 50s and 60s, they asked themselves, what’s the reason that I would stay here when I can go to Tennessee, Texas, Florida? And that’s what’s been happening. There’s lots of data that shows that, but this particular tax on the Pied a Terre, a place you stay when you’re in New York instead of a hotel, is interesting.”

O’Leary said the policy could have unintended consequences, particularly in discouraging individuals from maintaining or purchasing secondary residences in New York City.

“Let’s ask ourselves, without the rhetoric and the politics. Does this make sense? So you’ve got someone who spends a $5 million or more, does not really use the place, but still pays maintenance, so supporting employees in the building and property tax, but doesn’t put any burden on the city services whatsoever. How stupid a tax is this? Because you would want more people doing this, investing their capital in New York, not using any of the services of the city whatsoever, paying property tax all day long, even though they don’t live there, paying for maintenance in the building.”

He further criticized the policy as counterproductive to attracting capital into the city’s real estate market.

“This is the stupidest policy I have ever seen in real estate. Mamdani’s still in his honeymoon period. He’s only been a mayor for a few months. It’s amazing that his only policy moves that get loss of exposure, and it’s smart, because he’s pretty savvy at social media, is to think of new ways to tax people.”

O’Leary also argued that the focus on taxation does not address operational concerns related to city management.

“He doesn’t talk about efficiencies, executional skills try to run the city any better. That’s not what he’s doing. He’s saying, Look, I’m going to get you a lot of free stuff.”

He referenced additional proposals tied to public programs and said such strategies have historically faced challenges.

“We know for certain that he’s going to try his free food program in Harlem soon. What I think is going to happen to him and many others that have tried the strategy of money for nothing and chicks for free is the weight of the policy finally breaks down. You know, it doesn’t work. You can’t get stuff for free.”

O’Leary also raised concerns about targeting specific groups for increased taxation.

“And actually selecting one element of the population for being successful and taxing them more than other people under the concept of their fair share is not fair enough. Is basically un American. That’s not the American dream.”

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