NYC Property Tax

How Savvy Investors Can Spot Distressed Properties Before NYC’s 2025 Tax Lien Sale
Published 12/20/2024 at 9:00 AM
By: Benjamin Williams
As New York City prepares for its May 2025 tax lien sale, property owners with overdue taxes face growing financial pressure. For investors interested in distressed real estate, this scenario creates a strategic opportunity: the lead-up to the lien sale provides early indicators—via publicly posted lists—of which properties might be ripe for negotiation and acquisition.
Key Dates and the Lien Sale Timeline
The City’s next lien sale is scheduled for May 2025. Several lists showing properties at risk will be released beforehand, with the first “90-day list” expected around February 2025. Subsequent notices at 60, 30, and 10 days before the sale will follow. By tracking these lists, investors can pinpoint properties under intense financial strain.
Rising Interest Rates on Late Taxes Compound the Pressure
Late property tax payments don’t just linger—they become more expensive over time. The New York City Department of Finance (DOF) charges interest on late payments, compounded daily. This means the longer a property owner waits, the more they owe in interest, creating a significant incentive for distressed owners to cut a deal sooner rather than later.
For Fiscal Year (FY) 2025 (7/1/24–6/30/25), the late payment interest rate for properties with an assessed value over $450,000 is 16%, up from 15% in FY’24, 14% in FY’23, 13% in FY’22, and 18% in FY’21 and many prior years. With daily compounding, owners with large, valuable properties see their debts snowball at a daunting pace—heightening their motivation to resolve the situation before the lien sale.
Data Signals Growing Delinquencies Among High-Value Properties
Recent DOF data (as of May 3, 2024) indicate increasing delinquency rates among high-value parcels. For semi-annual filers with assessed values over $450,000 in FY’24, the total delinquent amount reached $499,980,526 for parcels delinquent by $5 or more—an 18.51% increase from FY’23. The number of such parcels was 5,481, highlighting that even larger asset classes are feeling the squeeze.
For investors, this surge in delinquency among higher-assessed properties suggests there may be more owners of commercial, multifamily, and upscale residential properties who are grappling with rapidly increasing interest charges. With interest rates higher than ever and compounding daily, these owners face a steep financial climb, making them prime candidates for distressed sales.
How Investors Can Leverage the Lien Lists
- Early Property Identification:
By reviewing the 90-day list in February 2025—and subsequent lists at 60, 30, and 10 days—you gain an inside track on properties in trouble. This intel helps you focus on prospects most likely to entertain offers as interest accumulates and deadlines loom. - Direct Owner Outreach:
Armed with knowledge of their rising interest bills and impending lien sale, you can approach owners before May 2025. They may be more willing to accept an offer below market value if it means avoiding runaway interest costs and the eventual transfer of their lien. - Secondary Market and Post-Sale Opportunities:
While you can’t buy individual liens directly from the City, building relationships with the trust or servicer that eventually acquires the liens could open doors. Monitoring properties on the brink of foreclosure and leveraging secondary market options can pay off after the sale. - Foreclosure Monitoring:
Should a lien progress toward foreclosure, your early research gives you a competitive edge. You can act quickly, whether by negotiating with the lienholder or offering a solution to the owner before they lose the property.
Timing, Data, and Relationships Matter
With interest compounding daily at 16% for high-value properties in FY’25, distressed owners have a stronger incentive than ever to find relief. By tapping into the 90-, 60-, 30-, and 10-day lists and understanding the upward trend in delinquencies, investors can time their outreach and negotiations to secure favorable terms.
A Strategic Real Estate Ally: Rosenberg & Estis, P.C.
Navigating these opportunities successfully requires not just knowing when and where to act, but also having expert legal support. For 50 years, Rosenberg & Estis, P.C. has guided clients through New York’s complex real estate transactions—from acquisitions and sales to financing, development rights transfers, leasing, and beyond. Our integrated approach, which combines transactional skill with a deep understanding of litigation and administrative frameworks, ensures that clients receive unmatched service.
We represent a wide range of clients—buyers, sellers, landlords, borrowers, lenders, developers, building owners, condo and co-op boards, and joint venturers—in transactions such as:
- Acquisitions & Sales
- Development
- Joint Ventures
- Leasing
- Financing
- Ground Leases
- Development Rights Transfers
- Opportunity Zones
- Construction Agreements
- Coop/Condo/Shared Ownership Structuring
- 1031 Exchanges
- Zoning & Land Use
- Trust & Estates
- Real Estate Property Tax Analysis
- Loan Workouts/Restructurings
Contact Us Today
As interest accrues on late taxes, and the lien sale countdown begins, the stakes are high. Don’t navigate these complex waters alone. Contact Rosenberg & Estis, P.C. to learn how we can help you leverage the lien sale environment, identify distressed assets, and secure favorable deals in an increasingly competitive marketplace.