Rising waters, falling taxes: The impact of Hurricane Sandy on property tax assessments in New York City

Climate disasters can inflict significant property damage and depress housing markets, yet their effects on property tax administration remain poorly understood. Homeowners with or without property damage may face tax burdens that do not match changes in their property values after disasters. This study examines the impact of Hurricane Sandy on property values and tax assessments in New York City. Using a difference-in-differences approach and comprehensive property-level data, we find that (1) inundated properties faced greater tax burdens due to taxable values falling less than corresponding market values after the storm; (2) unaffected properties in flood zones saw even larger tax burden increases as market values fell while taxable values remained unchanged; and (3) higher-valued homes bore larger tax burden hikes. These uneven consequences largely reflect the interplay between market reactions to Hurricane Sandy and City’s tax relief measures and existing assessment policies, highlighting how property tax administration is intertwined with disaster responses in the era of climate change.