Pratt Center Research

Sustainable Community Development

Reforming New York City's 421-a Property Tax Exemption Program: Subsidize Affordable Homes, Not Luxury Development

Report  |  July 2, 2003

In this report, Habitat for Humanity-New York City and Pratt Center for Community Development review the 421-a property tax exemption program and present findings that the program is being used to subsidize market rate and luxury housing rather than the affordable housing it was designed to generate. In 2006, the City of New York considered a much-needed over-haul of the 421-a program, which provided extensive tax breaks to residential developers.  The 421-a program was created three decades earlier at a time of fiscal crisis and neighborhood abandonment, when New York was hungry for any new development The report calls for a strong set of reforms to meet today’s affordable housing needs.