The NYC Transfer Tax is a seller closing cost which is 1.4% for sale prices of $500k or less, 1.825% for sales above $500k and below $3 million, and 2.075% for sales of $3 million or more. There is actually both a NYC and a NYS Transfer Tax, however most real estate professionals simply refer to the combined Transfer Taxes as the ‘NYC Transfer Tax.’
The Transfer Tax rates of 1.4%, 1.825% and 2.075% include both the NYC and NYS component. The NYS Transfer Tax accounts for 0.4% of the Transfer Tax rates for sales below $3 million, and it’s a higher 0.65% for sales of $3 million or more.
The 1% Mansion Tax in NYC is technically an additional NYS Transfer Tax on sales of $1m or more. However, it’s not generally included when referring to Transfer Taxes since the Mansion Tax is customarily paid by buyers while the standard Transfer Taxes are paid by sellers.
Estimate your Transfer Taxes in NYC with Hauseit’s Interactive Transfer Tax Calculator.
The Real Estate Transfer Tax in NYC is customarily paid by sellers. This includes both the NYC and NYS components. However, the reverse is true when it comes to new construction, condo conversions and any other type of ‘sponsor sales.’ In these instances, the buyer customarily pays the city and state Transfer Taxes.
Asking a buyer to pay the transfer taxes for a traditional private resale of a condo, co-op or house in NYC is a non-starter. However, it’s not uncommon for buyers to negotiate with a developer on who pays the Transfer Taxes. If the developer (sponsor) is highly motivated to sell, they may agree to pay some or all of your ‘sponsor closing costs’ which include Transfer Taxes and sponsor attorney fees.
Conversely, a developer probably won’t be willing to cover any sponsor closing costs if they’re having no trouble putting units into contract. A seasoned buyer’s agent can help you determine whether or not it’s worthwhile to ask the developer to cover some or all of your sponsor closing costs as part of your initial offer.
Overall closing costs for sellers in NYC are between 8% to 10% of the sale price. The largest seller closing cost is the traditional 6% broker commission. Buyer closing costs are approximately ~4% for a condo if you’re financing and ~2% if you’re paying all cash. Buyer closing costs are approximately 1% to 2% of the sale price if you’re buying a co-op.
The combined NYC and NYS Transfer Tax rates are 1.4% for sales of $500k or less, 1.825% for sales above $500k and below $3 million, and 2.075% for sales of $3 million or more. The NYC component is 1% (for sale prices of $500k or less) and 1.425% (for sales above $500k). The NYS component of the Transfer Taxes is 0.4% for sales below $3 million, and 0.65% for sales of $3 million or more.
The NYC Transfer Tax rates are different for property types other than condos, co-ops and one- to three-family houses. For other types of real estate transfers, the NYC Transfer Tax (RPTT) rates are 1.425% for sales of $500k or less and 2.625% for anything above $500k. The higher NYS Transfer Tax rate of 0.65% kicks in at $2 million for commercial deals compared to $3 million for residential deals.
