It’s been all over the news: Wall Street bonuses will be the biggest in four years!
The Office of the New York City Comptroller has previously forecast that bonuses in the financial sector will rise by 6% this year, based on significant 2025 growth on Wall Street.
They weren’t wrong: According to Reuters, “Wall Street bonuses are expected to rise for the second year for traders and investment bankers on surging deal volume and market volatility, according to financial compensation consultancy Johnson Associates.”
Reuters continues, “The bonus pool is expected to be the highest since 2021, when deals and profits surged to a record. Equity sales and trading professionals are expected to get the biggest bonus bumps of 15% to 25%, while investment bankers in M&A advisory and equity underwriting will likely get increases of 10% to 15%.”
We all know that fat bonuses last year led to a very robust real estate market, with REALTOR.com reporting that the Hamptons’ high-end housing market had a banner year thanks to such payouts.
Sales of Hamptons’ homes for $5 million or more reached an all-time high in late 2025, according to a new report by appraiser Miller Samuel for Douglas Elliman.
“A third consecutive year of double-digit stock market returns, and record Wall Street bonuses helped fuel demand for luxury properties,” Philip V. O’Connell, managing director of brokerage Brown Harris Stevens’ Hamptons office, told Mansion Global.
The New York Post joins in on the joyful serenade, publishing an article denoting that Manhattan’s luxury market is roaring back towards 2016’s healthy peak, due to bonuses continuing to be on the upswing.
By the end of last year, the median price for a luxury home — defined as the top 10% of the market — hit $6.39 million, according to a new report from Douglas Elliman.
The New York Post further expounds, “The luxury sector also proved more resilient coming out of the downturn.”
During the early 2020 downturn, the pandemic, and remote-work uncertainty, luxury homes rebounded faster than the middle market, as wealthy investors rely less on financing and are less prone to turbulence from interest-rate volatility.
Luxury condos, in particular, outperformed in the last few years, “a shift that reflects long-term stabilization rather than sudden popularity,” according to the New York Post.
While these blockbuster payouts are certainly good for those interested in investing in real estate, the political climate in NYC may not be. A monkey wrench may be thrown into the mix with the new mayor’s proposed tax policy.
Though nothing is set in stone, in February, Mayor Mamdani declared there were only two ways to close the budget gap: Either tax the wealthiest New Yorkers two percentage points on those making $1 million or more per year or raise New York City property taxes on average 9.5% as a “last resort,” according to a recent New York Times article.
“If we cannot follow this first path,” Mamdani said, “we will be forced onto a much more damaging path of last resort — one where we have to use the only tools at the city’s disposal: raising property taxes and raiding our reserves.”
“The second path is painful,” he added. “We will continue to work with Albany to avoid it.”
From a homeowner’s perspective, both proposals materially change the economics of owning in New York City — even at the $1 million price point, which is very much middle-of-the-road for the city.
The mayor is proposing raising the citywide rate across the four property tax classes — ranging from Class 1, small homes, to Class 4, including offices and hotels — to 13.45%, up from the current 12.28%.
This proposed expansion of the Mansion Tax/Transfer Tax effectively raises the cost of transacting. While it’s framed as a “luxury” measure, in practice, it hits ordinary primary residences because $1 million–$1.5 million is no longer a luxury threshold in Manhattan or Brooklyn. It discourages mobility — people stay put longer, delay selling, or think twice about upgrading — which ultimately freezes inventory and hurts the broader market.
The ongoing property- or wealth-based tax proposal is more concerning for homeowners because it’s not a one-time transaction — it’s recurring. Mortgage payments, property taxes, maintenance, and insurance are already fixed, non-negotiable costs. Adding another annual tax tied to asset value, rather than income or liquidity, puts pressure on cash flow. For many homeowners, the home isn’t a speculative asset; it’s where their savings are parked. So being taxed repeatedly on unrealized value changes affordability in a very real way.
Together, the mayor’s proposals reach far beyond ultra-high-net-worth owners. They land squarely on working professionals and long-term residents who bought responsibly, carry mortgages, and plan within fixed budgets. The practical outcome is reduced mobility, increased carrying costs, and a system that quietly discourages ownership rather than sustaining it.
The New York Times notes that such measures would likely raise housing costs, put upward pressure on rents, and increase operating expenses for landlords — affecting more than three million homes and over 100,000 commercial buildings citywide.
It remains too early to predict which proposal ultimately advances, but markets respond to incentives. Traditionally, higher bonuses translate into movement; uncertainty around policy changes alters that equation. How this balance is struck will shape not just transaction volume but also who the city ultimately remains accessible to.
