NYC sorts every property into one of four tax classes, and each class is assessed on a different fraction of its . That difference is one of the most persistent tax-equity debates in city politics.
The gap between the two bars is the untaxed share of each class's value.
Most detached, semi-detached, and row houses with up to three units, plus most residential vacant land in outer boroughs. State law caps how much a Class 1 property's assessed value can rise year over year (6% per year, 20% over five years), regardless of how fast market value actually grows.
Residential property with more than three units — this includes rental apartment buildings, and every co-op and condo unit, whether owner-occupied or not. Subdivided into 2A (4–6 units), 2B (7–10 units), and 2C (co-ops/condos of 2–10 units); larger buildings are simply Class 2. No annual assessment-increase cap applies, so Class 2 assessments track market value much more closely than Class 1.
Property owned by utility companies (equipment and special franchise property), plus some utility-company real estate. A small class by lot count but assessed differently from the other three under state law.
Offices, stores, factories, warehouses, hotels, and all other commercial or industrial property not in Classes 1–3. Like Class 2, there's no annual cap on assessed-value growth — Class 4 assessments move with market value.
These three terms describe different things and are easy to conflate:
A legal category (1, 2, 3, or 4) that determines how a property is assessed and taxed under state law. Every property has exactly one tax class.
A more granular DOF code (e.g. "R4" for condos, "A1" for single-family detached homes) describing the physical building type. Many building classes can map to the same tax class.
A broader description (residential, commercial, mixed-use, vacant land, utility) often used in DOF's own published summary tables — related to, but not identical to, tax class or building class.
DOF's estimate of what a property would sell for on the open market — derived from sales, income, and cost data. This is what this site calls "market value" throughout. It is an assessment estimate, not an appraisal or guaranteed sale price.
The portion of market value actually subject to the assessment ratio and caps for a property's tax class. For Class 1, this is capped well below market value; for Classes 2–4, it moves much closer to market value.
Assessed value minus any exemptions (e.g. STAR, senior, veteran, or J-51/421-a abatement programs). This is the number the tax rate is actually applied to.
The portion of assessed value that's excused from taxation entirely — government, religious, and nonprofit property is commonly fully exempt.