B U YE R ’ S G UI DE TO PURCHASING A HOME IN NEW YORK CITY
Ja c o b Wo o d Licensed Associate Real Estate Broker 111 Fifth Ave New York, NY 10011 917.232.0803 Jacob.wood@elliman.com Possessing an exemplary work ethic, ideal interpersonal skill and unyielding eye for detail has enabled Jacob to amass the enviable track record of having closed over 100 transactions his seven years in Manhattan real estate. Having earned a reputation among both his clients and colleagues as a doggedly determined worker and aggressive negotiator, as well as that of a polished and friendly professional, Jacob prides himself on his ability to provide guidance to clients of all needs, from a 1031 exchange or investment property to a resale and subsequent new home purchase. Jacob also has at the ready a network of reliable professionals,
from real estate attorneys and mortgage bankers to cable guys and licensed movers, in order to ensure you’re taken care of from start to finish. Jacob's flexible and innovative strategies are second to none. By delving deeply into your desired home, building, neighborhood, and lifestyle, Jacob is able to uncover inventory no other agent will have access to, and put together options you wouldn't conceive of otherwise. Jacob is available day and night to answer any questions you might have about your dream home, or the constantly evolving New York real estate market.
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GETTING STARTED
PURCHASING JOURNEY
CO-OPS & CONDOS
TOWNHOUSES
REAL ESTATE TERMS CLOSING COSTS FOR CONDO APARTMENTS CLOSING COSTS FOR CO-OP APARTMENTS CLOSING COSTS FOR TOWNHOUSES & SINGLE FAMILY PROPERTIES NEW YORK STATE MANSION TAX
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★★★★★ Highly likely to recommend 05/02/2019 – Justin DeMaris Bought a Cooperative home in 2019 in Noho, New York, NY
Local knowledge: Process expertise: Responsiveness: Negotiation skills:
★★★★★ ★★★★★ ★★★★★ ★★★★★
My wife and I met Jacob in a slightly unusual way – he was the seller’s agent on the other side of the table from us at the first apartment we tried to buy. We were immediately impressed by his breadth of knowledge, both about the specific unit we were looking at, the market overall and the purchasing process. We did not end up purchasing that unit because Jacob managed to get a higher price than we were willing to pay from another buyer, but we were completely swept off our feet by his ability to remain both professional and amicable to us while at the same time representing his own client’s interests to the fullest and promised ourselves that if we had an opportunity, he was exactly the person we wanted in our corner in the future. He was leagues above the other agents we had worked with so far. He became our agent in our attempt to continue our search and we grew to rely on his network of fellow professionals across bankers, lawyers, inspectors, movers, contractors, cleaners, painters, and every other nook and cranny of the industry that we needed. We very quickly found our new favorite property and Jacob guided us through the process of negotiation, board package prep, coop approval and the closing. I cannot recommend him enough and we are incredibly happy with our new home. Seriously, Jacob is the real deal. I wish I could give ten stars on every aspect.
Tips for Buying in New York City The constantly evolving New York City real estate market presents numerous challenges for buyers. With these challenges in mind, I’d like to share with you some key information in order to help you become better prepared in your search for a new home:
Market Overview Here are some important facts about the market to help you understand how the New York City residential real estate business is not like most other places: 1.
There are about 1,283,000 total owner-occupied housing units in the five boroughs, with around 18,000 (1.4%) for sale at any given time.
2.
Of the roughly 1,283,000 owner occupied housing units across the five boroughs of New York City, around 319,000 are single-family townhouses, 620,000 co-ops, and 320,580 condos.
3.
Total New York City coop, condo, and single-family townhouse sales in 2018 were 30,853, 12% less than 2015 and 22% greater than 2009.
4.
There is no MLS in Manhattan. All agents who are members of the Real Estate Board of New York (92% of NYC’s 30,000 agents) have access to all other REBNY agent’s listings. There is also no comprehensive, consumer-facing listings database for the NYC market. For this reason, it’s best to develop a trusted, working relationship with a buyer’s agent.
5.
There is no binder system in NYC either. An accepted offer is simply a handshake until a contract is fully executed and returned to the buyer’s attorney, along with the contract deposit. Hence a deal can easily be ‘gazumped’*.
Pre-Approved Mortgage A pre-approval on a mortgage is expected along with any offer. Any mortgage banker will produce a credit check and verify your income, assets, retirement funds and liabilities using your tax returns, bank statements, pay stubs as verification in order to determine your borrowing potential. A pre-approval letter may be issued that specifies your borrowing power and price range. Many listings agents request pre-approval letters before granting viewings. For this reason, it’s best to get mortgage pre-approval before beginning your search in earnest.
Mortgage Contingency When sellers have a choice of buyers, they are likely to choose the one who offers the most straightforward contract. A contract that is not contingent on the buyer obtaining financing is particularly attractive. If you plan on taking out a mortgage for your purchase and offer a nofinancing contingency, it is wise to not only obtain a pre-approval for financing, but forward the building’s financial documents to the bank as well for approval. Buyers also have the option of waiving their appraisal contingency, protecting themselves if the building is ultimately deemed not financeable by lenders, while allowing the seller to protect themselves from an inaccurate appraisal.
Financial Statement When your candidacy is being evaluated, cooperative and condominium boards will scrutinize both your offer and your financial condition. Therefore, during the bidding process you will be asked to submit your financial statement to the seller’s broker. Your broker will advise you to prepare this in advance and should give you a format to follow that includes your assets, liabilities, and sources of income.
Other Documents to Prepare Co-op and condo boards require that the buyer have both business and personal reference letters. After having gone into contract, we’ll talk more about how to specifically tailor these to the building in question. You’ll also draft a cover letter to the board of directors, giving some introductory, background information on yourself and / or your family. Sellers may ask for verification of income and assets along with any offer as well. Lastly, establish a relationship with a real estate attorney and have their contact information ready when you submit your bid.
Multiple Offers A bidding war can ensue with multiple offers when two or more buyers compete for the same property. This process sometimes drives the price beyond the seller’s original asking price before one buyer emerges victorious. I’ll help you devise strategies for handling these situations when they occur. *Gazumping is a term used in the UK and Australia when a seller (especially of property) accepts a verbal offer of the asking price from one potential buyer, but then accepts a higher offer from someone else. It can also refer to the seller raising the asking price at the last minute, after previously verbally agreeing to a lower one. In either case, the original buyer has to either offer a higher price or lose the purchase. There is a common misconception that you are 'gazumped' if you agree to buy a property for less than the asking price and then another buyer agrees to pay more than your lower offer.
PURCHASING J O UR N EY The purchase process for a condo or townhouse can move, as long as a loan can be secured in a timely fashion. In such instances, a sale can move from contract to closing in about 60 days. However, the co-op process is more involved and often takes longer — 60 to 90 days, or longer, is not unusual.
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★★★★★ Highly likely to recommend 10/24/2018 – Belde190 Bought a Cooperative home in 2018 in West Village, New York, NY
Local knowledge: Process expertise: Responsiveness: Negotiation skills:
★★★★★ ★★★★★ ★★★★★ ★★★★★
I had a fantastic experience purchasing my first home with Jacob by my side. Given I had only been a resident in the US for two years when I embarked on purchasing a home, it was critical I had a broker with local knowledge, expertise, and patience. Jacob’s combination of first rate local knowledge, market expertise and composed persona made for an excellent home buying experience. I would highly recommend him.
★★★★★ Highly likely to recommend 08/06/2018 – jwwebman Bought a Cooperative home in 2018 in Greenwich Village, New York, NY
Local knowledge: Process expertise: Responsiveness: Negotiation skills:
★★★★★ ★★★★★ ★★★★★ ★★★★★
Jacob assisted me with a home purchase in the West Village/Greenwich Village in the winter/spring of 2018. During my search, most brokers/agents sent me the same inventory that I could find myself on the internet; however, Jacob was able to source this apartment for me based on his local knowledge. Once we found the apartment, Jacob was an invaluable resource every step of the way which was crucial for me as a first time buyer. Could not recommend more highly!
KEY MOMENTS IN YOUR JOURNEY
1 PRE-APPROVAL 2 PROPERTY SEARCH 3 OFFER NEGOTIATION: Once you’re ready to buy,
your agent will communicate your offer to either the seller’s agent or to the seller directly. The seller may counter your offer, which opens a negotiation process that will eventually lead to a meeting where price, terms and closing date will be agreed upon.
6 LOAN APPLICATION: If financing, you should move forward with your loan application and schedule an appraisal with your financial institution.
7 COMPLETE APPLICATION: You will receive these
requirements and materials from your agent, which typically include: an application, a financial statement signed by the purchaser or a CPA, all requisite support for your financial statement, two to three years of tax returns, bank statements, letters of personal and financial reference, letters of professional reference, the contract of sale and bank documents (if financing) indicating that your loan is in place. Your Douglas Elliman agent will assist you in this process. In the case of a co-op, if your application meets initial approval, you will be invited to be interviewed by the board or an interviewing committee.
4 CONTRACT REVIEW: You’ll want to be represented
by an attorney that is familiar with New York City real estate during this stage. They should examine the contract of sale and by-laws and financial condition of the building to conclude it’s satisfactory before allowing you to sign the contract.
5 SIGN CONTRACT: At this time, you will usually
be required to present a deposit. The contract, plus the deposit, will then be forwarded to the seller for a signature. This money will be held in the seller’s attorney’s escrow account until closing. It is important to note that until all parties have signed the contract and it has been delivered, the seller can still entertain and accept other offers.
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BOARD APPROVAL BANK SUPPLIES CLEARANCE TO CLOSE CLOSING SCHEDULED FINAL WALK-THROUGH AND CLOSING
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Making an Offer When making a formal offer to purchase, there are several additional terms other than price the seller may be willing to consider. Below is a list of these terms, and how to leverage each in order to make our offer more attractive to sellers: 1. Offering price and financing contingency: Nearly half of all NYC real estate transactions are ‘all cash’. If paying cash is an option for you, although you wish to take advantage of favorable financing terms, you may close with cash and take out a loan against your home equity after closing, or waive your financing contingency and commit to closing in cash if, for whatever reason, you’re not able to secure financing. If you cannot commit to paying cash at closing, waiving your financing contingency may still be an option if your bank has loaned in the building recently and your pre-approval is completely current. If purchasing in a building where your bank has not loaned recently, you may elect to waive your appraisal contingency only, protecting yourself if you can’t secure financing, and allowing the seller to protect themselves in the event that the property appraises inaccurately. 2. REBNY financial statement: All offers in NYC must be submitted with a completed and signed REBNY financial statement. The statement need not be accurate to the nearest dollar or corroborated with bank statements, simply an accurate picture of your income, assets, and liabilities. The more forthcoming we are on the REBNY financial statement, the more attractive our offer will be to sellers, especially in a coop. 3. Mortgage pre-approval: All offers in NYC which include financing must be submitted with a current mortgage-preapproval, not a pre-qualification. Mortgage pre-approvals from a large and reputable financial institution with as few contingencies as possible will be most attractive to sellers, especially in a coop. Because different income and tax scenarios can greatly impact mortgage pre-approval, you should get pre-approved by your lender of choice before beginning your search in earnest. 4. Closing schedule: A flexible closing schedule that can accommodate a seller who needs to close quickly, or one who needs to wait a few months to close, can greatly improve the attractiveness of our offer. 5. Links to professional resumes and letters of introduction: The informal employment confirmation that comes with a link to your professional resume can make a seller more comfortable with your offer. When competing against other buyers in a multiple-bid scenario, a letter of introduction highlighting your favorite aspects of the apartment, building, and neighborhood can put you over the top. 6. Attorney contact information: Providing the seller your attorney’s contact information with your offer sends the message that you are motivated, educated on the process, and organized. It also allows contract negotiation and due diligence to begin immediately upon acceptance of your offer.
Off Market Purchase Opportunities A unique and valuable resource I provide to my buyers is access to ‘off-market’ properties, those not found on any brokerage’s website, or any aggregate site such as StreetEasy. Below is an explanation of different types of ‘off-market’ listings, and how I arrange access for us: Off-Market Sellers: Once we sit down and get a thorough sense of what you’re looking for, we can zero in on specific floor plans in specific buildings that are a good fit for us. I will then draft letters to the specific owners of these homes, letting them know I have a qualified and motivated buyer interested in making them an offer. I actually do about 15% of my buyertransactions in homes generated by these letters! Non-REBNY listing agents: The Real Estate Board of New York is an organization to which over 90% of the 30,000 practicing real estate agents in New York City belong. It mandates that all members of REBNY must agree to co-broke their listings with one another, and that buyer-broker commissions must be fully disclosed and payable by the seller. If searching further out in Brooklyn or Queens, we will likely run into one of the small number of agents who are not members of REBNY. These agents are under no obligation to co-broke their listings with us, and under no obligation to share with me any details on the commission they’ve negotiated with their seller. These agents tend to work for smaller, less sophisticated, less scrupulous brokerages, and to have a buyer-agent protecting your interests when negotiating with them is paramount. Their sellers tend to have bargain-shopped when choosing a listing agent, and their homes tend to be marketed poorly, advertised at a price below (in some cases well below) market value. These listings can represent excellent opportunity for a buyer. For-sale-by-owner listings: FSBO sellers have elected to sell their homes themselves rather than hire a professional listing agent to act in their best interests while marketing and negotiating the sale of their property. FSBO sellers tend to make decisions based purely on cost savings, with little knowledge of or regard for the sales process. They are not bound by any industry or State law. For this reason, it is paramount to have a buyer-agent representing your interests when negotiating with a FSBO seller and attempting to close on a FSBO-represented property. FSBO listings sell for, on average, 16% less than comparable, professionally marketed homes, and therefore represent an excellent opportunity to purchase a home below (sometimes well below) market value.
Expired listings: Expired listings were marketed by another listing agent, or marketed FSBO, and did not sell. They are now off the market, however the seller would most likely still consider offers. Sellers of expired listings may not necessarily be in a hurry or highly motivated, and therefore may not offer cost savings relative to currently listed properties, however, they present an excellent opportunity to expand our choices if we’ve exhausted all on-market inventory.
CO - O P S & CO N D O S COOPERATIVE BUILDINGS
CONDOMINIUM BUILDINGS
Co-op buildings are more common in New York City than in other parts of the country. Approximately 75% of available New York City apartments at any given time are co-ops.
On average, 25% of available New York City apartments are in condominium buildings. When you buy a condo in New York City, you get a deed as if you were buying a house — this categorizes these units as “real” properties, unlike co-ops. Condos are the preferred choice for those with assets held outside of the United States or for buyers who are interested in greater ownership flexibility.
Individual tenants do not “own” their apartments as they would in the case of “real” property. Rather, co-ops are owned by an apartment corporation and individual unit owners are “shareholders,” which entitles them to a longterm proprietary lease. Co-ops are traditionally stricter when approving a buyer whose funds are not in the United States.
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★★★★★ Highly likely to recommend 10/24/2018 – davidsahin77 Bought and sold a Cooperative home in 2018 in Upper East Side, New York, NY
Local knowledge: Process expertise: Responsiveness: Negotiation skills:
★★★★★ ★★★★★ ★★★★★ ★★★★★
Jacob Wood is an exceptional real estate broker. After working with another agent who was unable to find me a home I liked at a price that worked for me Jacob was recommended to me by my real estate attorney as an agent who would listen, and who had experience working with small business owners like myself. Jacob immediately found multiple homes that could work for me, and negotiated multiple offers at once to get me the best deal. I ended up paying well below the asking price for a sunny studio in a luxury building, within walking distance to my work… the exact type of home I said I wanted when I began my search. I couldn’t recommend Jacob highly enough as the ideal broker to help buy a new home Yuksel Sahin Celebrity Hairstylist Manhattan New York.
CO-OP
CONDO
COST
Generally, more attractive.
Generally, more expensive.
APPROVAL PROCESS
The board interviews all prospective owners, and has the right to approve or reject any applicant.
No interviews are required Application is not as rigorous as the co-op board process.
FINANCING
Be prepared to put down at least 20% of the purchase price, plus closing costs.
Be prepared to put down at least 10% of the purchase price, plus closing costs.
MONTHLY FEES
Maintenance fees based on the number of shares the tenant owns (typically dictated by apartment size and floor level).
Common charges (services and amenities shared by condo residents) and property taxes.
TAX BENEFITS
Shareholders can deduct their portion of the building’s real estate taxes and their proportionate share of the interest on the building’s mortgage.
Real estate taxes are deductible, but common charges are not.
SUBLETTING
Must be approved by Board of Directors.
Typically permitted.
SELLING
Board will need to approve the new buyer.
Can be sold at will.
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Typical Co-op Requirements 1. 25 – 35% debt to income ratio: For example, if your housing payments and any other fixed monthly expenses, like car loans or student loans, are $10k per month, a 25% DTI would put your adjusted gross income at $480k per year. 2. 12 – 24 months of mortgage and maintenance payments in post-closing liquidity: For example, if your total monthly carrying costs for your new home are $10k per month, 24 months of post-closing liquidity would mean $240k in cash, stocks, bonds, and/or mutual funds left over post-closing. If the above requirements don’t work for your personal circumstances, you can usually receive a gift from family to help make the reserve requirements. Or, you can copurchase with someone so that combined totals meet the above requirements. Coops routinely accept applicants who fall short of one requirement if their overall financial position is secure. 3. A FICO score above 700. 4. Some co-ops do not allow pieds-a-terre (owners using the property as a vacation home) or co-purchase with parents. Some co-ops that allow co-purchases will want the person actually living in the apartment to be able to afford the monthly carrying costs on their own. 5. Many Park Ave, Madison Ave, Fifth Ave, Sutton Pl, and Beekman Pl co-ops require the purchaser to have at least half the purchase price left over in liquid assets post-closing. Many of those buildings prefer all-cash purchasers. 6. Most coops will turn down non-US citizens unless you have significant liquid assets in the US, have a social security number, and pay taxes here, and/ or have a long work visa. If you’re a non US citizen who doesn’t fit this profile, you’ll want to purchase in a condo. * Some buyers are hesitant to purchase in coops, due to high-profile disputes among eccentric board members and shareholders in tony East Side buildings throughout the 80s and 90s. Board members are themselves shareholders, who don’t wish to damage their own resale value with a reputation for running an unreasonable board. Only 6% of coop board applications result in board turndowns, and a disproportionate number of turndowns occur is situations where the seller was a FSBO or the buyer didn’t use their own agent. If you’re not planning to rent out your property immediately upon purchase, don’t have credit / background report issues, and qualify financially, you’ll want to seriously consider purchasing in a coop, as they typically sell for 25% less than comparable condos, and make up nearly two-thirds of the Manhattan housing stock.
TO W N H O US E S TOWNHOUSE Defined as a multi-story urban home, usually attached, that’s built close to the street and scaled similarly to the buildings surrounding it. Often times, they are multi-unit homes. They are sometimes renovated into a single unit or can be used as rental units for additional income. A Brownstone is a type of townhome, recognizable by the reddish-brown sandstone of its façade. When you purchase a townhouse, you own both the structure itself and the land. It has its own roof and may have a garage or private yard included. You’ll most likely have more freedom and flexibility with how you treat your
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property, particularly regarding renovations, subleases or additions. However, it’s important to research the zoning laws for these same reasons. While you won’t pay monthly common charges or maintenance fees as you would for condos and co-ops, you are 100% responsible for all repairs and general upkeep. Only about 2% of available residential properties in New York are townhomes, which creates a competitive market. Working with a knowledgeable agent will give you an advantage over other buyers.
To w n h o u s e s
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★★★★★ Highly likely to recommend 03/08/2017 - MrsNelthorpe Bought a Miscellaneous home in 2017 in Sutton Place, New York, NY.
Local knowledge: Process expertise: Responsiveness: Negotiation skills:
★★★★★ ★★★★★ ★★★★★ ★★★★★
This is my second time purchasing an apt with Jacob in Manhattan and he has consistently been a great source of information and a joy to work with throughout the years. Our purchase would not have been possible without his help throughout every aspect of the process from our initial search to our offering to our financing to our closing. I recommend him without hesitation.
R EAL E STAT E T ERM S APPRAISAL
Process of determining a property’s market value.
CLOSING COSTS
Expenses over and above the price of the property, paid at the closing.
COMMON CHARGES
Monthly charges paid by condo owners that cover the cost of shared building amenities.
CONTRACT OF SALE
A legal agreement between a buyer and seller that outlines the terms of purchase or transfer for a property.
CO-OP BOARD
A group of residents elected to represent all shareholders within a co-op building. The board determines the rules of the building, addresses building issues and reviews new buyer applications.
FINAL WALK-THROUGH
A property inspection that takes place a few days before closing so that the buyer can ensure the space’s condition is true to what is specified in the contract.
IN CONTRACT
An offer has been made and accepted on a property. The buyer has paid a deposit and both seller and buyer have signed the offer. The listing is no longer available on the market unless the deal falls through.
MAINTENANCE FEE
Monthly charges paid by co-op owners to cover operating expenses of the building, including taxes, insurance, etc.
MORTGAGE
Loan that a bank or lender gives you to buy a house. A mortgage payment is made up of principal, interest, taxes and insurance.
PRE-APPROVED
Written statement from your bank or lender confirming that you are approved for a specific loan amount.
PRE-QUALIFIED
An estimate of the loan amount you will likely be pre-approved for.
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Additional Professional Recommendations Mortgage Bankers: If your bank is advertising favorable rates, or if it is personally advantageous for you to keep your loan with a bank where you already do business, it is important for your banker to be experienced with the Manhattan real estate market. Regardless of your preferred financial institution, I likely have a relationship with at least one of their bankers. It’s important to use a banker who does the bulk of their business in local coop and condo transactions. Simply asking for a mortgage banker from your financial institution without taking a personal reference may result in being given a banker in upstate New York who isn’t familiar with the New York City purchase process, and may not even know what a coop is! The below are excellent: 1.
Peter J Malman, Chase (914) 774-6272, peter.j.malman@chase.com
2.
Zack Tolmie, Citibank (212) 559-2666, zack.tolmie@citi.com
3.
Ryan Pratt, Wells Fargo (347) 866-9983, Ryan.Pratt@wellsfargo.com
4.
Julie Teitel, Citizens Bank (917) 648-1388, Julie.Teitel@citizensbank.com
5.
Glenda Winter-Irving, Bank of America (917) 941-0516, Glenda.winter-irving@bankofamerica.com
Attorneys: The bulk of New York City real estate transactions are conducted by a relatively small circle of real estate attorneys. To have one of these attorneys conducting your transactions is paramount. They charge a rate of roughly $3000 and are worth every penny. Attorneys are the last place to bargain shop when pricing a real estate transaction. To be represented by an attorney of low quality, or by an attorney who does not do the bulk of their work in New York City real estate transactions, can easily derail an entire transaction and cost you your opportunity to purchase a home. The below attorneys are among the best, and make my clients their first priority due to the amount of business they receive from me. 1. Daniel M. Churgin, Sutton Sachs Meyer PLLC (908) 279-5555, daniel@ssm.law 2. Alan J. Lustrin, Lustrin Tetelman Adler, LLP (516) 729-8538, alustrin@ltllp.com 3. Lina M. Viviano, Romer Debbas LLP (646) 327-3995, lviviano@romerdebbas.com
General Contractor & Architect: If you’re purchasing with plans to renovate, choosing a general contractor and/or architect who is familiar with the process of renovating in New York City is of utmost importance. Renovating in a vertical housing structure is a categorically more complicated and bureaucratic process than doing so in a single family home. Low quality work can be much more expensive than any money saved when bargain shopping. 1. Rob Stevenson, KBRNY Inc. (646) 229-6866, rob@kbremodel.com 2. Mark Bearak, AIA (212) 321-0101, mark@dtlsarc.com Home inspectors: When buying a townhouse, or a coop / condo in a building with fewer than ten units, it may be advisable to get a home inspection. Home inspections are not typically done in coop or condo purchases in buildings greater than ten units, since any latent defect in the apartment is typically the responsibility of the seller, and any defect beyond the walls of the apartment is typically the responsibility of the building. 1. Rick Weisfeld, Old House Inspection Company Inc. 917.731.0556, rweisfeld@verizon.net Interior Designers: Furnishing a home when moving to NYC for the first time, or when upgrading to a larger space, can be overwhelming! Spruce Design NYC has flexible packages, from making the most out of what you currently own, to freshening up your furnishings with new pieces, to starting from scratch. 1. Katie, Spruce Design NYC 513.827.5140, spruceupwithkatie@gmail.com
CLOSING COSTS TYPICAL ESTIMATED CLOSING COSTS: CONDOMINIUM APARTMENTS FOR THE PURCHASER Buyer’s Attorney
Consult your attorney
Bank Fees
$750–$1,000
Application Fee
$350–$650
Processing Fee
$330–$500
Appraisal Fee
$500–$2,000
Credit Report Fee
$45–100+
Bank Attorney
$650–$1,000
Tax Escrow
2–6 months
Recording Fees Nassau
Appr. $1,200-$1,700 Deed Fee - $200 verification fee + $355 per block Verification Fee - $355 per instrument, per block
Suffolk
Deed Fee - $200 per lot per document Verification Fee - $200 per instrument, per lot Mortgage Fee - $300 per mortgage or mortgage type document
Recording Fees - NYC & Westchester
Appr. $250–$750
Fee Title Insurance
Variable by transaction
Mortgage Title Insurance
Variable by transaction
Municipal Searches
$350–500
Flip Tax
Varies building to building, consult your agent
MORTGAGE TAX PROPERTY TYPE
MORTGAGE TAX New York City
Residential Condo Unit up to $499,999.99
2.05% (0.25% paid by lender; 1.8% by mortgagor)1
Residential Condo Unit $500,000 and up
2.175% (0.25% paid by lender; 1.925% by mortgagor)1
Commercial Condo Unit up to $499,999.99
2.05%2
Commercial Condo Unit $500,000.00 and up
2.8%
ADDITIONAL EXPENSES MORTGAGE TAX Nassau, Suffolk, Dutchess and Orange Counties
MORTGAGE TAX Yonkers
1.05%1
1.8%1
Maintenance Adjustment
Pro-rates for the month closing
Short-term interest
Equal interest for the balance of month in which you close
*Mansion Tax is paid by purchaser on transactions that are 100% residential and the purchase price is $1M or above. 1 Minus $30 for 1-2 family 2 Four family residence requires mrt to be calculated at the commercial rate This closing-cost guide is designed to give you the general costs associated with the purchase or sale of a condominium property. Please note that these are estimates and that potential buyers and sellers should consult their real estate attorney or financial advisor for specifics. Kindly note, we do not represent that these art the entirety of potential costs, but are only to be used as a guide. All transfer and filing fees are subject to change by government agencies in each location.
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CLOSING COSTS TYPICAL ESTIMATED CLOSING COSTS: CO-OPERATIVE APARTMENTS FOR THE PURCHASER Buyer’s Attorney
Consult your attorney
Bank Fees
$550–$1,000
Application Fee
$350–$650
Processing Fee
$330–$500
Appraisal Fee
$500–$2,000
Credit Report Fee
$45–100+
Bank Attorney
$650–$750
Lien Search
$350–$450
UCC-1 Filing Fee
$20 - $40 in all counties except for Nassau
UCC-1 Filing Fee (Nassau)
$340 ($40 to file + $300 per block)
*Mansion Tax is paid by purchaser on transactions that are 100% residential and the purchase price is $1M or above.
ADDITIONAL EXPENSES Miscellaneous Co-op Charges
Varies by building
Recognition Agreement Fee
Approx $250
Flip Tax
Please check with building
Maintenance Adjustment
Pro-rates for the month closing
Short-term Interest
Equal interest for the balance of month in which you close
This closing-cost guide is designed to give you the general costs associated with the purchase or sale of a condominium property. Please note that these are estimates and that potential buyers and sellers should consult their real estate attorney or financial advisor for specifics. Kindly note, we do not represent that these art the entirety of potential costs, but are only to be used as a guide. All transfer and filing fees are subject to change by government agencies in each location.
Do ugl a s E ll i m a n Re a l Es t a t e B uy e r ’ s Gui d e
Clo s i n g C o s ts : C o - o ps
10
CLOSING COSTS TYPICAL ESTIMATED CLOSING COSTS: TOWNHOUSE & SINGLE-FAMILY HOMES FOR THE PURCHASER Buyer’s Attorney
Consult your attorney
Bank Fees
$750+
Application Fee
$350+
Processing Fee
$330+
Appraisal Fee
$500–$2,000
Credit Report Fee
$45–100+
Bank Attorney
$750–$1,000
Tax Escrow
2–6 months
Mortgage Recording Fees Nassau
Appr. $1,200-$1,700 Deed Fee - $200 verification fee + $355 per block Verification Fee - $355 per instrument, per block
Suffolk
Deed Fee - $200 per lot per document Verification Fee - $200 per instrument, per lot Mortgage Fee - $300 per mortgage or mortgage type document
Recording Fees - NYC and Westchester
$250–$750
Fee Title Insurance
Variable by transaction
Mortgage Title Insurance
Variable by transaction
MORTGAGE TAX PROPERTY TYPE
MORTGAGE TAX New York City
Single Family Residence $499,999.99 and below
2.05% (0.25% paid by lender; 1.8% by mortgagor)1 2
Single Family Residence at $500,000 and up
2.175% (0.25% paid by lender; 1.925% by mortgagor)1 2
Commercial Properties and Vacant Land $500,000.00 and under
2.05%
Commercial Properties and Vacant Land $500,000.01 and up
2.80%
MORTGAGE TAX Nassau, Suffolk, Dutchess and Orange Counties
MORTGAGE TAX Yonkers
1.05%1
1.8%1
2
*Mansion Tax is paid by purchaser on transactions that are 100% residential and the purchase price is $1M or above.
Minus $30 for 1-2 family Four family residence requires mrt to be calculated at the commercial rate This closing-cost guide is designed to give you the general costs associated with the purchase or sale of a condominium property. Please note that these are estimates and that potential buyers and sellers should consult their real estate attorney or financial advisor for specifics. Kindly note, we do not represent that these art the entirety of potential costs, but are only to be used as a guide. All transfer and filing fees are subject to change by government agencies in each location. 1 2
Do ugl a s E ll i m a n Re a l Es t a t e B uy e r ’ s Gui d e
Closing Costs: Townhouse & S i n gl e Fa m i l y H o m e s
11
NEW YORK STATE MANSION TAX Mansion Tax (1% of purchase price) is paid by the purchaser on transactions that are 100% residential and the purchase price is $1M or more. In the five boroughs of New York City, the rate increases based on the sales price as follows:
PROPERTY PRICE
MANSION TAX RATE
$1,000,000 - $1,999,999
1.00%
$2,000,000 - $2,999,999
1.25%
$3,000,000 - $4,999,999
1.50%
$5,000,000 - $9,999,999
2.25%
$10,000,000 - $14,999,999
3.25%
$15,000,000 - $19,999,999
3.50%
$20,000,000 - $24,999,999
3.75%
$25,000,000 or more
3.90%
Do ugl a s E ll i m a n Re a l Es t a t e B uy e r ’ s Gui d e
New York S ta te M a n s i o n Ta x
12
N ew York State D E P A R TME N T O F ST AT E Division of Licensing S ervices P. O . Box 22001 Albany, N Y 12201-2001
C ustomer S ervice: (518) 474-4429 www.dos.state.ny.us
New York State Disclosure Form for Buyer and Seller
THIS IS NOT A CONTRACT N ew York State law requires re al estate license es who are acting as agents of buyers or sellers of property to advise the potential buyers or sellers with whom they work of the nature of their agency relationship and the rights and obligations it cre ates. This disclosure will help you to make informed choices about your relationship with the re al estate broker and its sales agents. Throughout the transaction you may receive more than one disclosure form. The law may require e ach agent assisting in the transaction to present you with this disclosure form. A re al estate agent is a person qualified to advise about re al estate. If you ne ed legal, tax or other advice, consult with a professional in that field.
Disclosure Regarding Real Estate Agency Relationships Seller’s Agent A seller’s agent is an agent who is engaged by a seller to represent the seller’s interests. The seller’s agent does this by securing a buyer for the seller’s home at a price and on terms acceptable to the seller. A seller’s agent has, without limitation, the following fiduciary duties to the seller: reasonable care, undivided loyalty, confidentiality, full disclosure, obedience and duty to account. A seller’s agent does not represent the interests of the buyer. The obligations of a seller’s agent are also subject to any specific provisions set forth in an agreement between the agent and the seller. In dealings with the buyer, a seller’s agent should (a) exercise reasonable skill and care in performance of the agent’s duties; (b) deal honestly, fairly and in good faith; and (c) disclose all facts known to the agent materially affecting the value or desirability of property, except as otherwise provided by law.
Buyer’s Agent A buyer’s agent is an agent who is engaged by a buyer to represent the buyer’s interests. The buyer’s agent does this by negotiating the purchase of a home at a price and D O S-1736-a (R ev. 11/10)
on terms acceptable to the buyer. A buyer’s agent has, without limitation, the following fiduciary duties to the buyer: reasonable care, undivided loyalty, confidentiality, full disclosure, obedience and duty to account. A buyer’s agent does not represent the interest of the seller. The obligations of a buyer’s agent are also subject to any specific provisions set forth in an agreement between the agent and the buyer. In dealings with the seller, a buyer’s agent should (a) exercise reasonable skill and care in performance of the agent’s duties; (b) deal honestly, fairly and in good faith; and (c) disclose all facts known to the agent materially affecting the buyer’s ability and/or willingness to perform a contract to acquire seller’s property that are not inconsistent with the agent’s fiduciary duties to the buyer.
Broker’s Agents A broker’s agent is an agent that cooperates or is engaged by a listing agent or a buyer’s agent (but does not work for the same firm as the listing agent or buyer’s agent) to assist the listing agent or buyer’s agent in locating a property to sell or buy, respectively, for the listing agent’s seller or the buyer agent’s buyer. The broker’s agent does not have a direct relationship with the buyer or seller and the buyer or seller can not provide instructions or direction directly to the broker’s agent. The buyer and the seller therefore do not have vicarious liability for the acts of the broker’s agent. The listing agent or buyer’s agent do provide direction and instruction to the broker’s agent and therefore the listing agent or buyer’s agent will have liability for the acts of the broker’s agent.
Dual Agent A real estate broker may represent both the buyer and seller if both the buyer and seller give their informed consent in writing. In such a dual agency situation, the agent will not be able to provide the full range of fiduciary duties to the buyer and seller. The obligations of an agent are also subject to any specific provisions set forth in an agreement between the agent, and the buyer and seller. An agent acting as a dual agent must explain carefully to
both the buyer and seller that the agent is acting for the other party as well. The agent should also explain the possible effects of dual representation, including that by consenting to the dual agency relationship the buyer and seller are giving up their right to undivided loyalty. A buyer or seller should carefully consider the possible consequences of a dual agency relationship before agreeing to such representation. A seller or buyer may provide advance informed consent to dual agency by indicating the same on this form.
Dual Agent with Designated Sales Agents If the buyer and seller provide their informed consent in writing, the principals and the real estate broker who represents both parties as a dual agent may designate a sales agent to represent the buyer and another sales agent to represent the seller to negotiate the purchase and sale of real estate. A sales agent works under the supervision This form was provided to m e by
of the real estate broker. With the informed consent of the buyer and the seller in writing, the designated sales agent for the buyer will function as the buyer’s agent representing the interests of and advocating on behalf of the buyer and the designated sales agent for the seller will function as the seller’s agent representing the interests of and advocating on behalf of the seller in the negotiations between the buyer and seller. A designated sales agent cannot provide the full range of fiduciary duties to the buyer or seller. The designated sales agent must explain that like the dual agent under whose supervision they function, they cannot provide undivided loyalty. A buyer or seller should carefully consider the possible consequences of a dual agency relationship with designated sales agents before agreeing to such representation. A seller or buyer may provide advance informed consent to dual agency with designated sales agents by indicating the same on this form.
Jacob Wood
(print nam e of license e) of Douglas Elliman Real Estate
(print nam e of company, firm or brokerage), a licensed re al estate broker acting in the interest of the: (
) S eller as a (check relationship below)
( X ) Buyer as a (check relationship below)
(
) S eller’s agent
( X ) Buyer’s agent
(
) Broker’s agent
(
) Broker’s agent
(
) Dual agent
(
) Dual agent with designated sales agent
F or advance inform ed consent to either dual agency or dual agency with designated sales agents complete s ection below: ( X ) Advance inform ed consent dual agency ( X ) Advance inform ed consent to dual agency with designated sales agents If dual agent with designated sales agents is indicated above: -represent the buyer; and --
is appointed to is appointed to represent the seller in this transaction.
(I) (W e)
acknowledge receipt of a copy of this disclosure
form: signature of { X } Buyer(s) and/or {
} S eller(s):
print: sign: D ate:
D O S-1736-a (R ev. 11/10)
D ate:
© 2019 DOUGLAS ELLIMAN REAL ESTATE.
EQUAL HOUSING OPPORTUNITY.
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Jacob Wood Licensed Associate Real Estate Broker O: 212.206.2833 | M: 917.232.0803 | Jacob.wood@elliman.com |
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