New Development Closing Cost Calculator for NYC

Property Details

Sales Price

Amount Financed

Housing Type

NYC and NYS Transfer Taxes

Sponsor Attorney & Document Fees

Estimated Closing Costs

New Construction Related Closing Costs

NY State Transfer Tax
Sponsor Attorney & Document Fees
Working Capital Contribution
Super Apartment Contribution

Typical Buyer Closing Costs

Move-In Deposit
Title Search - Other Charges
Board Application Fees
Move-In Fee
Survey Fees
Title Search - Endorsements
Deed Recording Fees
Lien Search Fee
Credit Check

Financing Related Costs

Title Insurance - Mortgage Policy Premium
Bank's Attorney Fee
Loan Application Fee
Appraisal Fee
Mortgage Recording Fee
UCC-1 Filing Fee
Total
Sponsor Pays
Buyer Pays
Total
Sponsor Pays
Buyer Pays
Total
Sponsor Pays
Buyer Pays
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Glossary

NYC Transfer Tax

The NYC Transfer Tax is a new construction buyer closing cost of 1% for sales below $500k and 1.425% for sales of $500k or more. Higher rates apply for commercial transactions and multifamily properties with 4 or more units. The combined NYC and NYS Transfer Taxes are customarily paid by sellers except for new construction and sponsor sales, for which these closing costs are usually paid by the buyer.

NY State Transfer Tax

The New York State Transfer Tax is 0.4% for sales below $3 million and 0.65% for sales of $3 million or more. The higher rate of 0.65% kicks-in at a lower threshold of $2 million for commercial transactions and residential properties with 4 or more units. Prior to the New York Tax Law amendments in 2019, the NYS Transfer Tax was previously a fixed 0.4% regardless of the sale price. The New York State Transfer Tax is authorized by New York Consolidated Laws, Tax Law – TAX § 1402.

Updated NYS Transfer Tax rates for NYC reflective of changes to the New York Tax Law Adopted in 2019.

Sponsor Attorney & Document Fees

Buyers of new construction are usually responsible for covering sponsor’s attorney and document preparation fees. This closing cost is often referred to as ‘Closing Fees.’ Here is an example of how this buyer closing cost is structured for a new development:

For each Unit, the sum of $4,000 shall be payable to Sponsor’s Counsel as a per unit base closing fee. For each issuance of a Parking Space License or Storage Bin License, the sum of $650 shall be payable to Sponsor’s Counsel as a per License base closing fee. If Purchaser obtains financing and the lender is unwilling to close at the offices of Sponsor’s Counsel, or if the Purchaser otherwise requests the Closing to occur other than at the office of Sponsor’s Counsel (or such other place as Sponsor may designate in its closing notice), the closing may be held elsewhere in New York City, provided that an additional travel fee is paid to Sponsor’s Counsel equal to: (a) $700 if the closing is held elsewhere in Manhattan; and (b) $875 if the closing is held in a borough other than Manhattan.

In addition, the Purchaser will be required to pay Sponsor’s Counsel:

(i) if, through no fault of Sponsor, the closing is adjourned (or is not concluded in its entirety on the day it commences), an additional fee of $300 for each adjournment (or continuation) to prepare and coordinate the new closing (or continuation);

(ii) if Sponsor, in its sole discretion, consents to a Purchaser’s request for an assignment of the Agreement, or for the addition, deletion or substitution of names on the Agreement, a fee of $1,000, payable in advance;

(iii) $300 for the preparation of ACRIS transfer documents required by the City of New York;

(iv) if Purchaser obtains mortgage financing, an additional fee of $850; and

(v) the sum of $875 in connection with the consideration, review and processing of any agreement of exchange or the like which Sponsor is requested to execute in connection with any tax-deferred exchange under §1031 of the Internal Revenue Code. Purchaser may be required to pay more than one fee pursuant to the preceding provisions of this paragraph with respect to a single Unit. Other additional charges may apply. At Sponsor’s option (in its sole discretion), any one or more of the foregoing fees to be paid to Sponsor’s Counsel shall be paid by Purchaser prior to closing upon notice to Purchaser.

Working Capital Contribution

Buyers of new construction are usually responsible for making an initial contribution to the building’s Working Capital Fund and/or Reserve Fund. Here is an example of how this buyer closing cost may appear for a new development:

A contribution to the Working Capital Fund in an amount equal to one month’s Common Charges then in effect for the Unit pursuant to the budget in accordance with Schedule A hereto, as the same may be amended from time to time and a contribution to the Reserve Fund in an amount equal to one month’s Common Charges then in effect for the Unit pursuant to the budget in accordance with Schedule A hereto, as the same may be amended from time to time.

Super Apartment Contribution

Buyers of new construction in larger buildings are usually responsible for making a pro-rata contribution towards the purchase of the live-in super’s apartment from the developer. This is often referred to as a ‘Share of Cost of Residential Manager’s Unit.’ Here is an example of how this buyer closing cost may appear for a new development:

At the Closing to each Residential Unit, the Purchaser thereof, as a closing cost of such Purchaser’s Residential Unit, will be required to make the RMU Payment to the Condominium Board in an amount equal to such Purchaser’s pro rata share of the Purchase Price of the Resident Manager’s Unit plus closing costs as aforesaid determined in proportion to the Common Interest appurtenant to all Residential Units (other than the Resident Manager’s Unit) and in the amount more particularly set forth on Schedule A. The RMU Payment shall be held in the Working Capital Fund or in a segregated account.

Mansion Tax

The New York City Mansion Tax is a progressive buyer closing cost which ranges from 1% to 3.9% of the purchase price on sales valued at $1 million or more. The Mansion Tax itself consists of 8 individual tax brackets, with the lowest rate of 1% applying to purchases at or above $1 million and less than $2 million. The highest Mansion Tax rate of 3.9% applies to purchases of residential property valued at $25 million or more. Prior to the 2019 update, the Mansion Tax was a fixed rate of 1% for all purchases of $1 million or more.

Title Insurance

Title insurance is an insurance policy against any defects or future claims against the title for issues which were unknown at the time of purchase when the original title search was conducted. This means you’ll be protected if a previous owner comes out of the woodwork ten years after your purchase, and claims that there was a mistake in the chain of title and that he never sold the property to the seller of your property, which means the seller of your property didn’t have a right to sell it to you.

Title insurance comes in the form of an owner’s policy (which protects your home equity based on the purchase price) and a lender’s policy which insures your mortgage lender from any title-related losses on your loan’s principal balance. You can also purchase an additional insurance policy called a ‘Market Value Rider’ which will automatically step-up the amount of your Title Insurance policy coverage to match appreciation in the market value over time.

Attorney Fees

The average real estate attorney fee for a purchase transaction in NYC is $2,000 to $3,000. The flat fee rates you are quoted will vary based on the complexity of your real estate transaction. Lawyer fees can be as high as $5,000 for a more complex transaction and for new developments. Real estate attorney fees are typically taken at closing and will be part of the closing costs mentioned in your lawyer’s closing statement. Some lawyers may negotiate for half or some other portion of the fee to be paid upfront, with the remainder to be paid at closing.

If you’re buying a sponsor unit (new construction), it’s customary for the buyer to also cover the seller’s attorney fees in addition to the NYC and NYS Transfer Taxes. This is the reverse of a traditional private resale where sellers pay the Transfer Taxes and cover their own attorney fees. Keep in mind that sponsor closing costs are negotiable.

Move-In Deposit & Fees

Most condos and co-ops in NYC charge buyers a refundable move-in deposit in addition to a non-refundable move-in fee. Exact fees vary by building, and they are usually listed in the resale application (also know as board application). Keep in mind that these fees are usually non-negotiable, as they are contractual based on the underlying management agreement in place between a condo or co-op building and the managing agent.

Board Application Fees

Most condos and co-ops in NYC charge buyers a non-refundable board application fee. The fee is customarily collected upon submission of your board application along with move-in fees & deposits from the buyer and move-out fees & deposits from the seller. Always check your specific coop purchase application to see what forms of payment are accepted. Even if personal checks are permitted, we always suggest sending certified checks because it will eliminate the processing time associated with waiting for your checks to clear the bank. Keep in mind that this fee is non-refundable, meaning you won’t receive any money back if you’re unfortunate enough to be rejected by the co-op board.

Mortgage Recording Tax

The NYC Mortgage Recording Tax is a buyer closing cost which is 1.8% for loans below $500k and 1.925% for loans of $500k or more. The amount of the Mortgage Recording Tax is based on the amount of new loan being underwritten. This means your MRT bill will continue to go down as you increase the size of your down payment. You can reduce the amount of the Mortgage Recording Tax by negotiating a Purchase CEMA with the seller.

Use Hauseit's Interactive NYC Buyer Closing Cost Calculator for new development purchases, new construction condos and houses as well as co-op apartment sponsor sales.

Mortgage Related Fees

The typical mortgage application fee in NYC is $500 to $1000. Some banks will waive this fee for their preferred clients who have above $100k to $250k on deposit with the bank. The average appraisal fee is ~$750. Banks usually will not offer to cover this, as they have to hire and pay a 3rd party appraiser. Other mortgage-related expenses include a Mortgage Recording Fee of ~$200.

Disclaimer: Hauseit’s New Development (New Construction) Closing Cost Calculator for NYC provides estimates that are meant to be illustrative and used for reference purposes only. Exact closing costs in NYC will vary per transaction. Please consult the closing statement your real estate attorney will provide you for your exact buyer closing costs in NYC. Hauseit and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction. The services marketed on Hauseit.com are provided by licensed real estate brokers and other third party professional service providers. Hauseit LLC is not a licensed real estate broker nor a member of any multiple listing service (MLS).
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