🏡 New Jersey’s “Mansion Tax” Just Got a Major Makeover — and Sellers, this one’s for you.
As of June 30, 2025, NJ lawmakers passed a new state budget that reshapes the real estate landscape for 2026. Here's what you need to know:
📌 What Changed?
The Mansion Tax—originally a 1% fee on homes over $1M, typically paid by the buyer—will now be paid by the seller. And it’s no longer a flat fee. It's tiered, meaning the higher the sale price, the higher the tax.
📊 Why Now?
Back in 2004 when the tax was introduced, $1M was luxury. Today? It’s common, especially in coastal and suburban areas. With NJ’s median home price around $550K, the $1M threshold no longer signals ultra-wealth.
💸 What to Expect:
If you're selling a property over $1M, you’ll now see this tax added to your closing costs. It starts at $10,000 and increases with the sales price. Applies to single-family homes, condos, co-ops, multi-family (1–4 units), and some commercial properties.
🤔 How This Affects You:
If you're planning to list—or even thinking about it—this could impact your net proceeds. Timing, pricing, and prep strategies matter now more than ever.
Here’s the breakdown of the new tax on home sales over $1,000,000:
$1,00,0000 - $1,999,999 The existing 1% “mansion tax” remains, but the responsibility shifts from the buyer to the seller, amending the 2004 law
$2,000,000 - $2,499,999 2.0% Tax on the seller
$2,500,000 -$2,999,999 2.5% Tax on seller
$3,000,000 - $3,499,999 3.0% Tax on seller
$3,500,000 and above 3.5% tax on seller
Key dates to note:
Contracts fully executed on or after July 10, 2025: The 1% buyer-paid fee is eliminated. Instead, the seller will pay a new tiered supplemental fee based on the sale price.
Contracts executed prior to July 10, 2025, with deeds recorded by November 15, 2025: Any supplemental fee paid in excess of 1% will be refunded to the seller.
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