New York Real Estate Closing Costs Statistics (2023 Survey)
A new RealEstateBees.com survey of over 1,000 active real estate professionals found average closing costs for sellers and buyers in New York.
We reached out to over 1,000 active real estate professionals from New York to collect their insight on the real estate closing costs across the state.
The results are part of the large-scale survey—Nationwide Real Estate Closing Costs Index—conducted by the Real Estate Bees, a leading online real estate platform.
What Is Included in Closing Costs for a Seller in New York?
Costs included in seller’s closing costs most commonly across New York.
What Are Average Closing Costs for a Seller in New York When Selling with a Realtor?
The most common amounts of seller’s closing costs across the state of New York in an agent-assisted sale.
What Are Average Closing Costs for a Seller in New York When Selling 'by Owner'?
The most common amounts of seller’s closing costs across the state of New York in a FSBO sale.
How to Reduce Closing Costs for a Seller in New York?
The seller usually pays all real estate commissions, so if the seller negotiates a smaller percentage, that can help lower their closing costs.
Some New York real estate agents also reduce their commission if they bring the buyer, as they are not splitting the commission with another agent.
The seller can also ask the buyer to pay any transfer or flip taxes.
The seller may avail of presale inspection from a New York home inspector to reduce the number of issues on the buyer’s inspection and reduce seller’s concession.
They may also consider selling the property for under 1 million to avoid mansion tax.
Or, they may negotiate realtor commission (but you get what you pay for).
If the seller has the original title search from a purchase, this can save several hundred dollars.
It might be possible with a survey with no changes. They can use an existing survey as long as they execute an affidavit of no change.
The flip tax imposed by coops is the typical closing cost that can be negotiated between buyer and seller as to who will pay it.
The fee and amount itself are not negotiable with the coop. It must be paid.
Avoiding a realtor is a great way for a seller to eliminate their largest closing cost — the real estate commission.
The seller can try to negotiate that the purchaser pay the transfer taxes, which in NY are seller-paid taxes.
Outside of lowering your commission, there isn’t much else to be done.
Get an attorney to do the deal under $1,000. The attorney fee is a huge variable.
Can a Seller Avoid Paying Closing Costs in New York?
A cash sale to a New York real estate investor is a great way to reduce the closing costs for a seller. They’ll completely save the realtor commission, which is the largest fee they’ll have to pay.
Though selling a house to an investor won’t necessarily save other fees like transfer tax or attorney fees, some cash home buyers will offer to cover those fees for the seller which could eliminate them completely.
It’s not common in the market. If a seller is trying to avoid all costs, it will only lower the sale price.
We are in a seller’s market, so a cash buyer may offer to cover some costs.
Only if the seller negotiates that closing fees are paid by the buyer. However, it is rare that this happens and the seller almost always pays the broker fees in NY.
Not unless the buyer assumes the responsibility of paying the seller’s portion.
Yes, they can get the buyer to pay the closing costs and that can be in the contract.
The closing costs will come out of the proceeds of the sale, so the seller doesn’t have to come to the closing with money to pay these fees.
The only exception to this would be in the case where the seller doesn’t have enough equity in the home. In this case, they may be better off pursuing a short sale with their lender.
The closing costs when you buy real estate in New York typically are paid at closing out of the net proceeds of a sale.
If there is a mortgage being paid off by the seller at closing, there must be enough funds after the mortgage to pay off closing costs.
Depending on the market value of the home and the amount owed, most fees are paid at closing. If a home will sell for less than a mortgage, a short sale will be required.
The seller’s closing costs come out of the proceeds of the sale, so there is nothing out of pocket for the seller.
The buyer will have to cover the costs, or the realtor can use part of the commission to cover the costs if they want to save the deal.
The costs are paid through closing proceeds that are due to the seller at closing.
What Is Included in Closing Costs for a Buyer in New York?
Costs included in buyer’s closing costs most commonly across the state of New York.
What Are Average Closing Costs for a Buyer in New York When Buying with a Realtor?
The most common amounts of buyer’s closing costs across the state of New York in an agent-assisted sale.
What Are Average Closing Costs for a Buyer in New York When Buying Without a Realtor?
The most common amounts of buyer’s closing costs across the state of New York in a FSBO sale.
What Are Average Closing Costs for a Cash Buyer in New York When Buying with a Realtor?
The most common amounts of closing costs paid by cash home buyers in New York in an agent-assisted sale.
What Are Average Closing Costs for a First-Time Buyer in New York When Buying with a Realtor?
The most common amounts of a first-time home buyer’s closing costs across the state of New York in an agent-assisted sale.
How to Reduce Closing Costs for a Buyer in New York?
There are a multitude of things a buyer can do to help lower their closing costs.
They can negotiate lesser fees for their attorney, ask their real estate lender in New York for a closing cost credit, ask the seller for a closing cost concession, or apply for a grant to help cover the costs.
Depending on the type of property, buyers can also explore a Purchase CEMA (also known as a Purchase Consolidation Extension Modification Agreement).
This eliminates many of the government fees as it allows the buyer to take over the seller’s outstanding mortgage amount and consolidate it with their new mortgage.
This can drastically help reduce the closing costs, but it is not applicable on coops and not every lender will offer this.
Here are some suggestions to reduce buyer’s closing costs:
2. Seller concessions.
3. Take advantage of first-time home buyer’s programs such as down payment assistance programs, FHA, VA, and lender-specific programs.
4. Ask your realtor to contribute.
The best thing the buyer can do to reduce closing costs would be to purchase the home for cash.
Mortgage recording fees are expensive in New York and by purchasing for cash, they can reduce closing costs by between 1-2% of the mortgage amount they would have otherwise gotten.
The buyer can buy all cash and avoid the mortgage recording tax in NY. They can negotiate that their New York real estate brokerage reduces their commission and apply it towards their closing costs.
The buyer has to make sure that the seller is paying the transfer taxes. The buyer generally pays the mansion tax, but that can also be negotiated.
Same as a seller in a coop, the flip tax is the typical fee that can be negotiated among buyer and seller.
The fee and amount itself is not negotiable with the coop as the coop requires this fee at closing.
If the buyer is taking out a loan and the seller has one, sometimes a CEMA can be done. But this lowers the cost for the buyer more than the seller.
If the buyer shares an attorney with the lender, this can save a few hundred dollars.
Pay cash to avoid lender fees and mortgage recording tax.
How to Negotiate Closing Costs With a Seller in New York?
A buyer should always be aware of all the closing costs, especially if there is a coop flip tax, before making an offer.
They should know how much the coop charges and from whom the coop expects the payment from.
The buyer can then negotiate the fee with the seller by either submitting an offer with the seller paying the flip tax or offering to split the flip tax.
A buyer may also include in an offer for the seller to pay mortgage discount points.
With the lack of inventory, it’s hard for a buyer to have costs paid by a seller. Best chance for this is homes that are sitting on the market for more than one week.
To include closing costs, the sale price would be raised so the seller nets the number they desire.
This can be an issue with appraisal needing to be a higher sale price.
In New York, is it not customary to negotiate the standard closing costs like transfer tax or attorney fees in a regular sale.
The things that will be up for negotiation will focus on seller concessions for certain items that need to be repaired.
All negotiation goes through the real estate agents and attorneys.
Usually this happens at the offer stage before the contracts are signed, yet they can also add an addendum throughout the process if any issues arise.
If you’re paying the price they want, usually they will agree to cover some of your closing costs if the house sells at the price they want.
Also, if there are a few offers from other buyers, there’s more room to negotiate.
If you are buying from a sponsor, then you can try to negotiate the transfer taxes, sponsor’s attorney fee, in addition to capital contribution and ask for things such as a storage cage or parking spot if those exist within the building.
Rather than negotiating the price, the buyer can try to reduce the closing costs by negotiating that the seller pay certain traditionally buyer-paid closing costs, such as mansion taxes and even title insurance fees.
Offer a higher purchase price if they’re willing to contribute to the closing costs.
Can a Buyer Avoid Paying Closing Costs in New York?
No. There will always be costs bore by home purchasers such as recording fees, title fees, and attorney fees.
It might be possible to have the lender charge a higher interest rate to cover some costs.
Not unless they were approved for a grant which would cover their entire closing cost.
Yes, if the seller is willing to have the closing costs paid out of their sale proceeds.
Only if the seller is willing to cover the necessary expenses.
Are There Closing Costs Assistance Programs Available for Buyers in New York?
Some local lenders are looking for loans in low-income census tracts and minority neighborhoods.
If a home falls in this area, a lender may offer a grant to any buyer. If it’s just low-income census tracts, it would be for first-time buyers.
Yes, banks can make a loan that can cover the closing costs and they can just get a larger loan and the closing costs will be part of the monthly payment of the mortgage.
Not that I am aware of. The price of entry is so high in the city. Sadly, I haven’t experienced this.
There are a few closing cost assistance programs that the buyer can apply for, usually through their lender.
Yes, although the qualifications can be strict. Worth looking into, though!
Yes, at the federal and state level.
Who Pays Closing Costs in a Conventional Sale in New York?
Who Pays Closing Costs in a Cash Sale in New York?
Are Closing Costs Negotiable in New York?
What Are the Available Ways to Pay Closing Costs in New York?
Why Are Closing Costs So High in New York?
There are two sections of closing cost fees borrowers should be aware of: bank fees and government fees.
The bank fees are for items like the New York property appraiser, credit report, attorney, etc. These typically fall around $4k but can fluctuate based on the specific lender and New York real estate attorney chosen.
The government fees would be the title/tax/recording fees which make up the bulk of the closing costs.
Although they are typically standard across all lenders, they could fluctuate slightly depending on the specific New York title company.
There is also a “mansion tax” in New York for properties above $1M which is 1% of the purchase price added into the title/tax/recording fees.
For these reasons, closing costs can be generally higher in New York than in other parts of the country.
In New York City, the largest closing costs include title insurance, the mortgage recording tax for buyers financing imposed by both NYC and NYS (just under 2%) and the NYS mansion tax, which is a graduating tax starting at 1% for a $1M purchase price and higher.
Sellers must pay the NYC and NYS transfer tax (just under 2%) and in most coops, there is a separate tax called the flip tax.
The flip tax varies by each coop and can be a percentage of the gross sales price, a percentage of the profit on the apartment or another formula.
It can be as high as 3-5% of the purchase price. The flip tax can be negotiated between buyer or seller as to who pays it.
In NYC, it depends on the price points of the properties.
Transfer taxes are percentages based on sales price, mansion taxes come into play on properties over a million dollars. Mortgage recording taxes are on the mortgage amount.
In new development/new construction, there are additional closing costs, too, like a Super’s apartment contribution, contribution to build up the condo’s reserves, etc.
New York City is very expensive and the closing costs add up.
New York has high closing costs, partially due to the expensive nature of the homes.
Certain fees, like the state’s mortgage recording tax, is up to 1.8% in New York City.
In addition to that, New York is an attorney state, so both the buyer and seller pay for attorney representation which can often range from $2,000-3,500.
In the Buffalo Niagara region of NY, taxes are prorated for the day of closing.
Generally a buyer also starts an account with a New York escrow company, so this is close to a year of taxes in an area known for high property taxes.
Surveys updated at seller expense for all transactions and with a mortgage, a sale will have 3 attorneys.
NYC has high taxes: for the buyer, there is a mansion tax that increases starting at $1M with a 1% tax and it goes up.
For sellers, there is the residential transfer tax which is 1% for under $500K and then goes up, and the progressive transfer tax which starts at .4% for under $3M.
Taxes and prepaid fees tend to be the highest portion of closing costs for buyers. Sellers pay the transfer tax and mansion tax on properties purchased over $1 million.
In New York, closing costs are high because of transfer taxes, mansion taxes, title insurance fees, attorney fees, and lender fees, such as mortgage recording tax.
Because in NY, there’s lender fees on the attorney end, regular attorney fees, mortgage recording tax, and transfer tax.
Who Pays Closing Costs in a Divorce in New York?
Whichever party owns the property will pay the closing costs.
If the home being sold is owned by the husband, then the husband pays the closing costs.
If the property is owned jointly, then both parties are paying the closing costs because they are coming off the top as a cost attendant to the sale, before remaining proceeds are split.
When spouses are selling a marital home after or during divorce, the sellers (i.e., the divorcing spouses) can either agree to pay the transfer taxes 50/50, jointly, or in some other proportional split according to the divorce stipulation or court order.
A lot of people subscribe to the school of thought that if a marital home is a marital asset and therefore usually split its value 50/50, so both have to pay the transfer taxes equally.
Generally, the costs would be paid from the proceeds of sale before the remainder is distributed to the parties.
What Are the Transfer Taxes in Closing Costs in New York?
Both NYC and New York State charge a separate transfer tax. The NYC Real Property Transfer Tax (RPTT) breakdown is as follows:
1. Condos, co-ops, and 1-3 family $500K or less: 1.000% of the sales price
2. Condos, co-ops and 1-3 family over $500K: 1.425% of the sales price
3. All other property types (i.e., commercial) $500K or less: 1.425% of the sales price
4. All other property types (i.e., commercial) over $500K: 2.625% of the sales price
The NYS real property transfer tax rates are as follows:
1. Condos, co-ops, and 1-3 family less than $3 Million: 0.40% of the sales price
2. Condos, co-ops, and 1-3 family $3 Million or less: 0.65% of the sales price
3. All other property types (i.e., commercial) less than $2 Million: 0.40% of the sales price
4. All other property types (i.e., commercial) $2 Million or more: 0.65% of the sales price
Separately, buyers of residential properties (Condos, co-ops, and 1-3 family) priced at $1 million or more in NYC are also required to pay an additional NYS transfer tax called the “mansion tax.”
The mansion tax is between 1% and 3.9% of the sale price, and there are 8 tax brackets which increase based on the sale price. The highest tax rate of 3.9% applies to sales of $25 or more.
NYC and NYS transfer taxes are the second largest closing cost for sellers aside from broker commissions, which is why developers selling new construction condos (known as the sponsor) often negotiate to have the purchaser pay these transfer taxes.
This is a customary practice with new construction sales and comes with an additional bulk-up “penalty” for the purchasers.
The combined NYC and NYS transfer tax for sellers is between 1.4% and 2.075% depending on the sale price.
Sellers pay a combined NYC and NYS transfer tax rate of 2.075% for sale prices of $3 million or more, 1.825% for sale prices above $500k and below $3 million, and 1.4% for sale prices of $500k or less.
Who Pays Transfer Taxes in Closing Costs in New York?
While sellers in resale scenarios typically pay the NYC and NYS transfer taxes, and buyers pay the mansion tax in new development sales, it is not uncommon for the buyer to be obligated to pay all of the transfer taxes, as well as the sponsor’s attorneys’ fees.
When this occurs, the buyer pays the taxes based on a “bulked up” (also called a “grossed up”) value.
This occurs in residential sponsor sales and involves the process of figuring out the NYC real property transfer tax (RPTT) that the seller would have been obligated to pay, and adding that amount, plus the sponsor’s attorneys’ fees that the buyer is paying, to the overall purchase price. The buyer then pays the NYC and NYS transfer taxes based on this increased purchase price.
For example, on a $1,795,000 sale, the seller would have paid $25,578.75 in NYC RPTT and $7,180 in NYS transfer taxes, while the buyer’s only transfer tax obligation would have been $17,950 for the mansion tax.
If the buyer is obligated to pay the transfer taxes and sponsor’s attorneys’ fees (i.e., $4,250), the RPTT and NYS transfer taxes that buyer now has to pay would be calculated as follows based on a revised “bulked up” purchase price.
$1,795,000.00 + $4,250.00 = $1,799,250.00 (including purchaser-paid sponsor legal fee)
$1,799,250.00 x 1.425% = $25,639.31 (Bulk-up for NYC RPT tax)
$1,799,250.00 x 0.40% = $7,197.00 (Bulk-up for NYS deed tax)
$1,799,250.00 + $25,639.31 + $7,197.00 = $1,832,086.31 (Used to calculate NYC RPTT)
$1,799,250.00 + $25,639.31 + N/A = $1,824,889.31 (Used to calculate NYS deed tax + mansion tax)
a) NYC RPT tax: $26,107.23 (1.425% of consideration)
$1,832,086.31 x 1.425% = $26,107.23
b) NYS deed tax: $7,300.00 (0.4% of consideration rounded up to nearest $500)
$1,825,000.00 x 0.40% = $7,300.00
c) Mansion tax: $18,248.89 (1% of consideration when $1,000,000 – $1,999,999)
$1,824,889.31 x 1.00% = $18,248.89
The tax is generally paid for by the seller. However, there are certain exceptions to this rule. For example, new construction often transfers the obligation to the buyer.