Closing Costs NYC: Condo vs Co-op Buyer’s Guide 2019

Despite having to pay sky high prices for apartments in New York City, some NYC buyers may not even realize that there are additional closings costs that they haven’t considered. The extra costs can really add up, especially for condos. In this article, you'll see a comparison of condo vs co-op closing costs NYC buyers pay.

Co-op vs Condo: How much should I expect to pay for buyer closing costs in NYC?

Overall when purchasing a co-op in NYC, buyers should expect to pay about one to two percent of the purchase price, or two to three if the apartment costs more than $1 million. As for condos, expect two to four percent as a safe range, the lower end for properties under a million dollars with small mortgages. New construction can be much higher, in some cases above 5%. You can quickly estimate what you'll pay with Prevu's closing costs calculator for buyers.

Why are NYC condo closing costs higher?

It’s a double whammy, condos cost more in price terms and they also have higher real estate closing costs! The reason is that when you are buying a condo with a mortgage you a required to pay a mortgage recording tax and typically required to purchase title insurance. While if you purchase a co-op with a mortgage, you are not. Technically when you are buying a co-op apartment, you are buying shares in the co-op and have a proprietary lease on the apartment.  While it may be possible to purchase title insurance for a co-op, most opt not to buy it.


NYC Apartment Closing Costs - Condo vs Coop
NYC Condo, Photo courtesy of Prevu Real Estate 

What closing costs should I budget for my NYC purchase?

  • Attorney Fees (Condos & Co-ops): Most real estate agents will estimate that attorney fees will generally range anywhere from $1,500-$4,000 for the transaction. The good news is that real estate lawyers don’t typically charge you an hourly rate and are usually only paid upon the closing of the transaction. Many buyers are hesitant to bring a lawyer in early on to ask questions about a potential purchase, but they shouldn’t be because you will only have to pay if the deal closes and you won’t have to pay extra. In some cases, you will also have to pay for the bank’s attorney which could run you an additional $1,000.
  • Mansion Tax (Condos & Co-ops): While the threshold for the mansion tax in New York City is $1,000,000, you certainly won’t be getting a mansion for that price by most people’s standards. The mansion tax, also technically considered a transfer tax, is paid by the buyer on properties equal to or larger than $1,000,000. The tax amount varies and is a graduating rate starting at 1% and increasing based on ranges of purchase prices to a maximum of 3.9% for properties $25,000,000 or greater. These new rates will apply for purchases entered in to contract after April 1, 2019 and that close after July 1, 2019. The new rate schedule was included as part of the 2020 budget passed by the New York State Senate and Assembly. 
  • Title Insurance (Condos Only): If you are purchasing a condo and getting a mortgage you will need to get title insurance. This cost can vary depending on the provider but typically most estimate 0.45% of the purchase price. Title insurance is expensive but it protects buyers and lenders against claims on the title of your property prior to you owning the home. For example, unpaid property taxes or liens against the house are two potential issues that title insurance protects you (and your bank) against. While expensive, a mortgage company probably won’t lend you money without it.
  • Mortgage Recording Tax (Condos Only): And the hits just keep on coming for condo purchasers… The mortgage recording tax requires purchasers to pay 1.8% on mortgage amounts under $500,000 and 1.925% on mortgage amounts above $500,000. Remember this is the loan amount and not the purchase price. Yes, that’s real money out the door and paid upfront which will never be recouped. For example, if you bought the average apartment in Manhattan for $2,000,000 (yes that’s is crazy to be the average!), with 20% down, you would be paying 1.925% on the $1,600,000 loan amount or roughly $30,800 for the mortgage recording tax alone.
  • Flip Taxes (Co-ops): A flip tax is a transfer fee paid to the co-op corporation during a co-op apartment sale transaction. It is a fee and technically not a “tax”, therefore it is not deductible as a property tax as it is not levied by a government entity. The amount of the flip tax and who pays for it (buyer or seller) varies from co-op to co-op, but this information is generally outlined in the building’s proprietary lease or co-op by-laws.
  • Don’t Forget About Everything Else (Condos & Co-ops): Smaller items such as mortgage fees, appraisals, surveys, move-in deposits, application fees, recording expenses, and incidentals can start to add up as additional closing costs. Some of the mortgage fees may also be negotiable so don’t hesitate to ask your bank to see if they’ll be willing to chip in. If you don’t ask, you’ll probably never know.
  • New York State & NYC Transfer Taxes (New Development Condos Only): This typically only applies if you are buying in a new development in NYC. Depending on the strength of the market and demand for the unit, these transfer taxes can be negotiated with the sponsor. The New York City Real Property Transfer Tax is 1% of the price if the value is $500,000 or less, or 1.425% if it is more. Unfortunately, there is also a NY State transfer tax. New York State charges you an additional 0.40% transfer tax on the purchase price. The New York State transfer tax increases to 0.65% for residential transactions greater than $3,000,000 (as of the 2020 New York State budget passed on March 31, 2019).

Most Common NYC Closing Costs - Condo vs Co-op Comparison

Cost Condo Co-op
Attorney Fees Yes Yes
Mansion Tax Yes* Yes*
Title Insurance Yes No
Mortgage Recording Tax Yes No
State Transfer Tax No** No
NYC Transfer Tax No** No
Other Smaller Costs Yes Yes

* Applicable if price is greater than or equal to $1,000,000
** Applicable if new development

How can buyers offset some of their closing costs?

While most of these costs are unavoidable and are the “cost of doing business” when buying an apartment in NYC, potential buyers should educate themselves so that they are prepared when it comes time to make an offer on an apartment. In addition, a good way to help offset some of your closing costs is to get cash back with a buyer commission rebate. Prevu, a tech-enabled real estate brokerage in NYC, rebates two-thirds of the broker's commission it receives representing buyers.

Prevu’s Smart Buyer™ Rebate is the largest in NYC and you also benefit from having an expert real estate agent with you every step of the way. When buying a home in NYC with Prevu, you receive up to 2% cash back which certainly will help buyers cope with the mountain of closings costs. 

How to estimate your closing costs

Prevu has created a closing costs calculator for buyers in NYC so you can quickly estimate these costs. You can also reach out to Prevu or your real estate attorney to better estimate your closing costs so that you can plan for them in your budget. 


Co-op Closing Costs NYC ($2,000,000 purchase price, 20% down payment)

  • Attorney Fees — $3,000
  • NYC Mansion Tax — $25,000
  • Title Insurance — $0
  • Bank Attorney — $1,500
  • Mortgage Recording Tax — $0
  • Other Closing Costs — $4,000
  • NY State Transfer Tax — $0
  • NYC Transfer Tax — $0
  • Seller's Attorney Fee — $0
  • Total — $33,500


Condo Closing Costs NYC ($2,000,000 purchase price, 20% down payment)

  • Attorney Fees — $3,000
  • NYC Mansion Tax — $25,000
  • Title Insurance — $9,000
  • Bank Attorney — $1,500
  • Mortgage Recording Tax — $30,800
  • Other Closing Costs — $4,000
  • NY State Transfer Tax — $0
  • NYC Transfer Tax — $0
  • Seller's Attorney Fee — $0
  • Total — $73,300


Prevu is the real estate technology company on a mission to save people money when they buy or sell a home. Our industry-leading Smart Buyer™ Rebate makes it possible for homebuyers in NYC to receive a commission rebate of up to 2% of their purchase price with a seamless, end-to-end buying experience and the expert advice of a dedicated, salaried agent. 


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