New Construction Resales in Manhattan - Save Thousands of Dollars in Closing Costs
Seller Pays New York City and NY State Transfer Tax except when Buying from a Developer/Sponsor.
If you're looking to buy new construction you might save thousands of dollars by buying a resale in a brand new building. When a buyer purchases a condo or coop in a new development directly from the sponsor (developer) the buyer is usually required to pay New York City and New York State transfer tax.
When buying from a sponsor in a coop, (unsold shares) the transfer tax is not only the percentage of the sale price but the amount of the underlying mortgage allocated to the shares associated with the unit being purchased is also included.
In resales seller's pay transfer taxes. NYC transfer tax is 1.425% of sale price above $500,000. NY State transfer tax is $2.00 per every $500 in the sale price.
New buildings usually start selling pre-construction about 2 years before the building is ready for occupancy and the units close. Often the best lines sell out early and lower priced apartments on low floors. By the time the building opens there are usually a few resales. Either units never lived in purchased by flippers or a unit that might be for sale because of personal reasons.
If you missed out on a building you like during pre-construction sales buying one of the first resales in a new development has many advantages.
In addition to not paying transfer taxes and other possible sponsor related closing costs you can have more instant gratification. You get to physically see the apartment, the fixures and the view in person. In pre construction you buy off a floor plan and brochures. You don't always get to see the building or the apartment you are purchasing. You don't have to tie up your 10%-15% deposit for a year or more. The apartment is ready to move -in brand new.
If you are interested in New Construction consider the many advantages of buying a resale. If you would like to receive listings by email of Manhattan New Developments including resale listings click here.
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Mitchell Hall (Licensed as Mitchell J Hall)
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