421-a Is Gone. What It Means for Williamsburg

By Williamsburg 365 Staff

For more than 50 years, New York had a big tax break for new apartment buildings. It was called 421-a. The state started it in 1971. A builder who put up new apartments paid little or no property tax on the building for many years, sometimes decades. In return, the rental apartments were rent stabilized, and later versions also required some affordable apartments.

The program was renewed many times. The last version, called “Affordable New York,” started in 2017. It ended on June 15, 2022. Buildings that started before that date can still get the tax break if they are finished by June 15, 2031.

In April 2024, Albany passed a new program called 485-x to replace it. According to the city’s housing department, HPD, rental buildings with 100 or more apartments must make 25% of them affordable. Most buildings with 6 to 99 apartments must make 20% affordable. Under 485-x, the regular apartments are not rent stabilized.

For condo owners in Williamsburg, the biggest change is the tax bill. When a condo has 421-a, the owner pays very little tax at first. As the break runs out, the tax goes up a little every year.

In South Williamsburg, condo taxes have gone up a lot. In the 2022-23 tax year, the average condo there paid about $6,880 a year. For 2026-27 it is about $10,370. That is about 51% more. In 2022, about 4 in 10 of these condos still had a 421-a break. Today about 2 in 10 do.

On Wallabout Street, the average condo tax went from about $7,120 to about $13,710. On Walton Street, from about $6,550 to about $10,750. On Lynch Street, from about $6,940 to about $9,570. On Middleton Street, from about $6,110 to about $9,140. On Lee Avenue, from about $4,790 to about $6,410.

A Williamsburg condo that still has 421-a pays about $3,300 a year on average. Without the break, the same apartment would pay about $16,300. These numbers come from the city’s assessment records, not real tax bills, and they do not include STAR credits or tax appeals.

There are also fewer new condos for sale. New condo sales in Brooklyn dropped 41% from July to September compared to last year, because not many new buildings came on the market. The middle price of a new condo still went up 4%, to $1.361 million.

485-x is harder on Williamsburg than on most of the city. HPD puts Greenpoint, Williamsburg, South Williamsburg and East Williamsburg in “Zone A,” together with Manhattan below 96th Street. In Zone A, a building with 150 or more apartments must pay construction workers at least $76.12 an hour, or 65% of the prevailing wage, whichever is lower. Builders say this makes big buildings too expensive.

Fewer big buildings are being planned. The Real Estate Board of New York said that from April to June 2026, plans were filed for only 9 buildings with 100 or more apartments in the whole city. In the three months before, there were 25. Nineteen projects had exactly 99 apartments, just under the line. The total number of apartments filed dropped 52%.

Most of the big building in Williamsburg today is from projects that started under 421-a. About 40 projects in Brooklyn Community District 1, which covers Williamsburg and Greenpoint, signed up to finish under the old rules. Some have until 2031. Together they plan about 5,300 apartments, and about 1,600 of them are affordable.

Renters in older 421-a buildings should check their lease. According to the city’s Rent Guidelines Board, when the tax break ends, a landlord can take an apartment out of rent stabilization only if the lease and every renewal had a clear notice saying so. If there was no notice, the tenant stays rent stabilized.

Rents keep going up. The middle rent in Brooklyn was $4,300 a month in September 2026, 5% more than a year before. The number of apartments for rent fell 25%. Williamsburg ren…