Albany, NY – New York State Senator Pete Harckham and Assemblymember Linda Rosenthal have introduced new legislation that could provide significant financial relief to first-time homebuyers by exempting them from paying the mortgage recording tax. This tax is typically imposed by municipalities for legally recording a deed, mortgage, or other documents related to home purchases.
The proposed bill (S.4488 / A.5350) comes as the first-time homebuyer market has struggled amid high real estate prices and other financial pressures. The exemption from the mortgage recording tax could lead to substantial savings for homebuyers. For instance, with the 2024 median home price in New York at $642,500, a buyer with a $578,000 mortgage could save $5,780 if the typical one percent mortgage recording tax is waived.
Addressing Barriers to Homeownership
Harckham highlighted the increasing difficulty for New Yorkers to achieve homeownership due to high upfront costs. “Homeownership is a big part of the American Dream, but for many New Yorkers, the high upfront costs in these tough times have pushed the dream farther out of reach,” he said. “By exempting first-time homebuyers from paying their mortgage tax, we’ll be making this milestone achievement more affordable while also re-energizing our communities.”
Rosenthal, who chairs the Assembly Committee on Housing, emphasized that the state’s homeownership rate lags significantly behind the national average. “With home costs soaring around the nation, many New Yorkers fear that owning their own home may simply be unattainable,” she said.
Current Mortgage Recording Tax Rates
The mortgage recording tax varies across the state. While most municipalities charge around one percent, rates are higher in the 40th Senate District—between 1.05% in Putnam County and up to 1.8% in Yonkers. In New York City, the tax ranges from 2.05% to 2.175%, with a portion of the funds allocated to the Metropolitan Transportation Authority (MTA).
Challenges for First-Time Homebuyers
New York’s homeownership rate is the lowest in the United States, with only 53.6% of residents owning homes compared to the national average of 65.8%, according to the State Comptroller’s office. Additionally, the National Association of Realtors (NAR) reported that first-time homebuyers made up just 24% of the market in 2023, a historic low. Rising home prices, stagnant wages, and high mortgage rates—currently averaging 6.87% for a 30-year mortgage—are contributing factors.
Support for the Legislation
Tim Foley, CEO and Executive Vice President of the Building & Realty Institute (BRI) of Westchester and the Mid-Hudson Region, expressed strong support for the proposed bill. “This new bill addresses a significant financial barrier, making homeownership more attainable for many New Yorkers,” he said.
Real estate professionals also welcomed the potential relief for first-time buyers. “Anything that helps buyers with some relief at a closing on their first home would be welcome,” said Karen Benvin Ransom, a Licensed Real Estate Associate Broker with Houlihan Lawrence in Katonah.
Vlora Sejdi, 2025 President of the Hudson Gateway Association of REALTORS®, noted the impact of high closing costs on first-time buyers. “A large part of these upfront costs are real estate transaction taxes, including the mortgage recording tax. This legislation will enable more first-time homebuyers the opportunity to achieve the American dream of homeownership,” Sejdi said.
Next Steps
The proposed legislation will now move through the legislative process, with supporters urging swift passage to help address the housing affordability crisis and promote economic stability in New York communities.