Provides a real property tax exemption for first-time homebuyers of real property as primary residential property

6 Co-sponsors

• James S. Alesi
• John A. DeFrancisco
• Owen H. Johnson
• William J. Larkin Jr.
• Thomas P. Morahan
• Dale M. Volker

Title of bill

An act to amend the real property tax law, in relation to exempting real property purchased by first-time homebuyers from real property taxation

Purpose

To assist first-time buyers in purchasing homes.

Summary of specific provisions

Section one adds section 457-a to the real property tax law. Subdivision one of § 457-a provides, contingent upon adoption of a local law or resolution therefor, a real property tax exemption for certain first time homebuyers. Such exemption shall be computed according to a table detailed in that subdivision.

Subdivision two establishes eligibility criteria for a tax exemption, including that the first-time buyer be between the ages of eighteen and forty at the time of purchase and that household income not exceed $150,000. It likewise defines the terms "income" and "household income."

Subdivision three pertains to the requirement that a first-time homebuyer exemption is applicable only to a primary residential property, no portion of which is the subject of a lease.

Subdivision four requires that an application for tax exemption be submitted on a form prescribed by the state board and filed with the appropriate assessor.

Subdivision five pertains to the manner in which an assessor shall approve and enter an exemption granted pursuant to this legislation.

Subdivision six defines the terms "first-time homebuyer" and "primary residential property."

Existing law

§ 457 of the Real Property Tax Law authorizes a tax exemption for first time homebuyers of newly constructed homes. Such tax exemption is pursuant to a schedule that authorizes an exemption from 50% of the total value assessed in the first year, an exemption from 40% of the total value assessed in the second year, an exemption from 30% of the total value assessed in the third year, an exemption from 20% of the total value assessed in the fourth year and a 10% exemption from the total value assessed in the fifth year.

Justification

It is becoming increasingly financially difficult for young people to purchase homes in New York. As a result, many individuals, particularly those between the ages of 18-years-old and 40-years-old, have moved out of the state. Such outward migration has had an especially damaging effect on the younger populations of Long Island and Western New York. Indeed. since the 1990s, both communities have witnessed a decline, of approximately 20%. in those populations.

Legislation such as this. which is intended to provide working-age individuals the opportunity for homeownership, thereby ensuring a stable workforce supply in New York, is thus necessary to promote the long-term economic stability of the state.

Legislative history

2007-2008: S.7634

Fiscal implications

None to the state.

Local fiscal implications

As localities have the option of adopting pertinent legislation, the fiscal impact of such will be determined on an ongoing basis.

Effective date

Immediately.