Cities around the globe plan new tax on luxury second homes

According to CNN money, lawmakers in Paris, London and New York City are planning new taxes on high-end second-home purchases.

However, some analysts say that high-end real estate has been a key component in the housing market’s recovery, and higher taxes could halt growth. In New York, for example, a recently introduced bill would add tax of up to 4 percent a year on properties in New York City with a current market value of more than $5 million, but not apply to primary residences. However, a study from Columbia University on the similar 1 percent mansion tax on home sales above $1 million found that such tax reduces real estate transactions around the million-dollar threshold.

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