NYC Property Tax Classes 1–4: Which One Is Yours?

NYC puts every property in one of four tax classes: Class 1 for most one- to three-family homes, Class 2 for other residential buildings including co-ops and condos, Class 3 for most utility property and Class 4 for commercial and industrial property. Your class decides how much of your market value is taxed, how fast your assessment can rise and which tax rate applies.

Your class is printed on your Notice of Property Value and your tax bill. You can also see it on any building page on Roofy’s NYC lookup.

The four classes at a glance

FY2027 rates were adopted provisionally in June 2026 and may change; see how your bill is calculated for the details.

Class 1: small homes

State law (Real Property Tax Law §1802) puts “all one, two and three family residential real property” in Class 1, including homes used partly for business if they’re mainly residential. DOF adds that small stores or offices with one or two attached apartments usually land here.

Two condo rules matter:

• Residential condos no more than three stories high can be Class 1, as long as no unit was previously assessed as a regular (non-condo) dwelling.
• A condo with no more than three units stays in Class 1 only if it was already classified there on a previous roll.

The statute also places certain bungalow-colony homes on co-op land and some residentially zoned vacant land in Class 1. Class 1 is the only class assessed at 6% of market value, and DOF values it from sales of similar nearby properties.

Class 2 and its subclasses

Class 2 is everything else that’s primarily residential, except hotels and motels. That covers rental buildings with four or more units and nearly all co-ops and condos. DOF splits the smaller buildings into subclasses because they get assessment caps:

• 2a: 4- to 6-unit rental buildings.
• 2b: 7- to 10-unit rental buildings.
• 2c: 2- to 10-unit co-ops or condos.
• Class 2 (no letter): 11 or more units.

State law requires DOF to value Class 2 as income-producing property. For co-ops and condos, that means valuing them as if they were rental buildings, even though owners live in them. See market value vs assessed value for why that usually produces a value well below sale prices.

Class 3 and Class 4

Class 3 is mostly utility property. DOF values it from the cost of building or replacing the structures plus land value, and its FY2027 tentative roll notes that Class 3 market value is tentatively set by the New York State Office of Real Property Tax Services. Class 4 is commercial and industrial property, such as offices, stores, factories and hotels, plus anything that doesn’t fit Classes 1 to 3. DOF values Class 4 from income and expenses, partly using the owner’s annual Real Property Income and Expense (RPIE) filing.

Why small homes and co-ops are taxed so differently

Class 1’s tax rate is higher, but the rate is applied to a much smaller slice of value. Compare the totals from DOF’s FY2027 tentative roll:

Class 1 holds about half of the city’s market value but a small fraction of its assessed value. Three things drive that:

1. The 6% assessment level versus 45% for every other class.
2. Tight caps that keep many Class 1 assessments below even that 6% target.
3. Class shares: the city divides the total levy between classes, and state law limits how fast a class’s share can grow. Each class’s rate is set so its share of the levy is collected.

Co-ops and condos sit in the middle. Their 45% assessment level would mean big bills, but the income-based valuation usually gives a market value far below sale prices, and many owners get the abatement. A condo in a 2c building also gets the 8%/30% cap, while one in an 11+ unit building gets the five-year phase-in instead.

What if your class is wrong?

Classification errors happen, for example after a conversion from a two-family to a three-family house, or when a building’s unit count changes. You have two routes:

• DOF Request to Update: corrects descriptive information on your Notice of Property Value, such as the unit count or square footage. The Tax Commission says it can’t change those details itself.
• NYC Tax Commission: can review a claim that your property is in the wrong class. The deadline is set by the class shown on your notice, not the class you want. A Class 2 property asking to be Class 1 must meet the Class 2 deadline.

Step-by-step help is in how to appeal your NYC property assessment. Landlords can also read property tax classes for rental owners.

Estimate your tax by class

Once you know your class and assessed value, the NYC property tax estimator does the math. Check the building’s DOF class and building class code on its Roofy building page, and see NYC building class codes to decode them. This is general information; your Notice of Property Value is the official record.