​The Hidden Costs of Buying and Selling in NYC: What You Need to Know

Buying or selling property in New York City is more than negotiating a price. From legal fees to transfer taxes, there are many costs to consider that can add up quickly. Let’s break it all down:

1. A Quick Overview of Buyer and Seller Costs

• Buyer Costs: Typically range from 2%–4% of the purchase price.
• Seller Costs: Usually range from 8%–10%, largely driven by broker commissions and taxes.

2. Maintenance Fees and Common Charges - NYC specific

This is one of the key diffrences between Co-ops and Condos. Let's break it down.

• Co-op owners pay "Maintenance Fees" that combine:
  • Building Staff Salaries + Utilities and Repairs 
  • Property Taxes

 

• Condo owners pay "Common Charges" and "Property Taxes":
  • Common Charges: Cover operational costs like staff, amenities, and general maintenance.
  • Property Taxes: Billed individually, based on the unit's assessed value.

Key Difference:
Co-op fees combine everything into one payment, while condo owners manage property taxes and common charges separately.

3. Costs and Fees when you close on a condo/coop/townhouse in NYC

For Buyers:

• Attorney Fees: Vary, but typically $2,500–$5,000.
• Broker Commission: 0-3%, (typically covered by the seller) 
• Building Application Fees: $500 and up (for condos and co-ops).
• Title Insurance, Title Search & Recording Fees (Condos Only): Usually 0.6% of the sale price and up.
• Inspection Fees: Optional but highly recommended, especially for townhouses. Expect to pay $500–$1,200.
• Appraisal Fees: Required by lenders to confirm property value, costing $500–$1,200.
• Mansion Tax: Starts at 1% for properties priced between $1–2M and can rise to 3.9% for properties over $25M.​
• Move-In Deposit: $500–$1,000 (usually refundable if no damage).
• Homeowners Insurance: vary

For Sellers:
​

• Attorney Fees: Vary, typically $2,500–$5,000.
• Broker Commission: Vary
• NYC Real Property Transfer Tax:
  • 1% of the sale price if $500K or less.
  • 1.425% of the sale price if above $500K.
• NYS Transfer Tax:
  • 0.4% of the sale price for transactions less than $3M.
  • 0.65% of the sale price for transactions greater than or equal to $3M.
• Payoff Bank Fees (if applicable): $250 and up.
• Managing Agent Fees: $650 and up.

4. Special Withholding Taxes for Non-Residents

For non-resident sellers, these additional taxes may apply:

• NYS Capital Gains Tax Withholding: 8.97% of the taxable gain. (Only applicable to non-NY residents)
• Federal Withholding Tax (FIRPTA): 10%–15% of the sale price. (If seller is non-U.S. resident)  **additional may apply

5. Carrying Costs During the Selling Process

If you’re selling your property, you’ll need to budget for ongoing carrying costs until the sale is complete, including:

• Monthly maintenance fees (co-op) or common charges and property taxes (condo).
• Utility bills.
• Insurance premiums.

6. Fees exclusive to New Developments

When purchasing in a New Developement, Buyers are repsonsible for additional fees. In some cases some of the fees might be negotiated with a sponsor/developer. It is always beneficial to consult with a qualified Real Estate Agent to structure the offer. 

Buyer in New Developement will be additionaly responsible for: 

• NYC Real Property Transfer Tax:
  • 1% of the sale price if $500K or less.
  • 1.425% of the sale price if above $500K.
• NYS Transfer Tax:
  • 0.4% of the sale price for transactions less than $3M.
  • 0.65% of the sale price for transactions greater than or equal to $3M.
• Sponsor Attorney Fee: $2,500 - $3,500
• Working Capital Fund Contribution: One-time fee equal to 1-3 months common charges, depending on condominium
• Contribution to the Resident Managers Unit: Prices can vary so be certain to inquire

​

​Navigating NYC real estate is complex, but understanding these hidden costs can help buyers and sellers prepare for smoother transactions. Always consult with real estate, legal, and tax professionals to ensure you’re fully informed and prepared for your next move.