Prefer a printed copy? Download the NYC Home Buyer's Guide (PDF), or run your own numbers with the NYC Real Estate Calculator.

 

Before You Start: How Much Can You Afford?

 

Thinking of buying an apartment? Before choosing a real estate agent, browsing listings and scheduling tours, it is important to get your finances in order. Taking this step early helps you present a stronger mortgage application and gives you a clear understanding of your financial position before you fall in love with a specific property.

 

Buying a home involves more than the monthly mortgage payment. You should also plan for one-time costs such as the down payment, closing costs, legal fees, inspections and moving expenses, and, depending on the property, post-closing reserves. As you set your budget, consider the following.

 

Your Spending Patterns

Review your bank statements and monthly expenses from the past several months. Look closely at recurring bills, subscriptions, dining, travel and discretionary spending to understand what monthly payment feels realistic for your lifestyle.

 

Housing Expenses to Income

A common guideline is to keep your monthly housing costs (mortgage, common charges or maintenance, taxes and insurance) at a manageable share of your gross income. The right number depends on your overall financial picture, long-term goals and comfort level.

 

Debt to Income

Lenders look closely at your debt-to-income ratio, which includes obligations such as car payments, student loans and credit card balances. Co-op boards are often stricter than lenders. Many co-ops prefer a debt-to-income ratio of 25% or below, although this varies from building to building, and a ratio above 30% may still be acceptable in some smaller co-ops.

 

Your Credit Score

Your credit score is one of the key factors lenders use to price your mortgage. Scores generally range from 300 to 850, and borrowers in the mid to high 700s or above usually qualify for the most favorable rates and terms. If your score needs improvement, focus on paying down high credit card balances and correcting any reporting errors. Even a modest increase can make a meaningful difference in your borrowing costs.

 

A note on your down payment

A larger down payment reduces the amount you borrow, which lowers both your monthly payment and the total interest you pay. With 20% or more down you can usually avoid mortgage insurance. At the same time, do not use all of your available funds for the purchase. Lenders, and especially co-op boards, want to see reserves after closing, and you should also budget for moving, possible renovations and the unexpected.

 

 

How Much Cash Do You Actually Need?

 

The amount of cash you need to buy a home goes beyond the down payment. Before making an offer, account for your down payment, buyer closing costs, legal fees, inspection costs and, when applicable, required post-closing liquidity.

 

Buying a Condo

Most NYC condos allow financing with a minimum down payment of around 10%, although many buyers choose to put down 20% or more. Condos generally do not have building-specific post-closing liquidity requirements, although your lender may require you to keep adequate reserves.

 

Because a condo is real property, buyer closing costs include title insurance and, when you finance, the NYC mortgage recording tax. That is why the closing costs of a financed condo are meaningfully higher than those of a typical co-op purchase. Purchases of $1 million or more are also subject to the New York State mansion tax.

 

Buying a Co-op

Most NYC co-ops require a down payment of at least 20% to 25%, and some buildings require 30% or more. Co-op closing costs are generally lower because you are buying shares in a corporation rather than real property, so title insurance and mortgage recording tax do not apply. You should still budget for attorney fees, lender fees, lien search and filing fees, building fees and the mansion tax if the price is $1 million or more.

 

The biggest additional consideration with a co-op is often post-closing liquidity. Many co-ops require buyers to keep a set amount of qualifying liquid assets after closing, commonly calculated as a number of months of mortgage and maintenance payments. For example, if a co-op requires 24 months of post-closing liquidity and your monthly mortgage and maintenance total $7,000, you would need $7,000 × 24 = $168,000 remaining in qualifying liquid assets after your down payment and closing costs have been paid.

 

Example: $1,000,000 Purchase

Assumes a 30-year fixed mortgage at 6.50% (illustrative only). Figures are calculated with the same formulas used in my online calculator.

 

Condo, 10% down

• Down payment: $100,000

• Loan amount: $900,000

• Principal & interest: $5,689 / mo

• Common charges + taxes / Maintenance: $2,100 / mo

• Total monthly cost: $7,789 / mo

• Mansion tax: $10,000

• Mortgage recording tax: $17,325

• Other closing costs: $16,250

• Estimated closing costs: $43,575 (4.4%)

• Post-closing liquidity: Lender reserves only

• Estimated cash needed: $143,575

 

Co-op, 20% down

• Down payment: $200,000

• Loan amount: $800,000

• Principal & interest: $5,057 / mo

• Common charges + taxes / Maintenance: $1,950 / mo

• Total monthly cost: $7,007 / mo

• Mansion tax: $10,000

• Mortgage recording tax: Not applicable

• Other closing costs: $8,050

• Estimated closing costs: $18,050 (1.8%)

• Post-closing liquidity: $168,157 (24 months)

• Estimated cash needed: $386,207

 

The co-op buyer in this example needs more than twice the cash of the condo buyer, even though closing costs are lower. Purchase price and affordability are not always the same thing. Actual figures depend on the property, financing, building requirements and your circumstances.

 

Can Family Help With the Purchase?

Potentially. Some co-ops allow gifted funds from parents or other family members, while others restrict or prohibit gifts, guarantors or parents buying for their children. Condos are generally more flexible, although lender requirements still apply. If you are receiving help from family, disclose it early so your agent, lender and attorney can confirm the structure works before you make an offer.

 

The Buying Process at a Glance

• Step 1, Build Your Team: Agent, lender and attorney

• Step 2, Pre-Financing: Pre-approval, proof of funds, REBNY Financial Statement

• Step 3, Find Your Home: Neighborhoods, listings and tours

• Step 4, Offer & Contract: Comps, offer, negotiation, inspection, contract and deposit

• Step 5, Loan Commitment: Underwriting and appraisal

• Step 6, Board Application: Board package and co-op interview

• Step 7, Closing: Insurance, clear to close, walk-through and keys

• Step 8, Post-Closing: Move-in, utilities, abatements and records

 

 

Step 1: Build Your Team

 

I recommend building your team in the order below. Real estate agents are in constant contact with lenders and attorneys, which puts them in a unique position to see who is responsive, thorough and easy to work with. The right introductions can make a real difference in how smoothly your transaction runs.

 

1.1 Choose a Real Estate Agent

A buyer's agent is your guide, analyst and negotiator. A good agent gives you objective information, access to the full range of available listings (including pre-market inventory), and the comparable sales you need to negotiate well. Just as important, a good agent helps you stay objective at the moments when it matters most.

 

Who Pays the Buyer's Broker Fee?

Many buyers ask this. Based on data we collected from 131 new Compass listings in Manhattan, the vast majority of sellers were offering compensation to the buyer's broker, which means buyers often do not pay an additional fee out of pocket. If a property is structured differently and a direct buyer fee may apply, I believe that should be disclosed before any showing, so there are no surprises.

 

1.2 Choose a Lender

If you are financing your purchase, speak with a mortgage broker or lender early. A good lender helps you understand your budget, strengthens your offer, and moves quickly once you find the right property. I am always happy to recommend trusted mortgage professionals, but you should choose the one who best fits your needs.

 

1.3 Choose an Attorney

New York is an attorney state, so buyers hire a real estate attorney to review and negotiate the contract of sale and represent them at closing. Your attorney will:

 

• Conduct due diligence on the building and the unit

• Order the title report or lien search (checking for liens and violations)

• Review and negotiate the contract

• Provide documents required by your lender

• Determine the funds due at closing

• Represent you at the closing

 

I am glad to recommend experienced NYC real estate attorneys, and you are always free to choose your own.

 

 

Step 2: Pre-Financing

 

Before an offer is submitted, listing agents will typically ask for three items:

 

• A pre-approval letter

• Proof of funds for the down payment, closing costs and, for a co-op, any required post-closing liquidity

• A completed REBNY Financial Statement

 

Some listing agents ask for only one or two of these, but it is best to have all three ready in advance.

 

2.1 Get Pre-Approved for a Mortgage

A pre-approval letter is one of the first documents sellers want to see. Issued by a lender, it estimates how much you are qualified to borrow and shows that you are financially prepared to move forward. Pre-approval is different from pre-qualification: pre-qualification is usually a rough estimate based on limited information, while pre-approval generally involves a review of pay stubs, bank statements and tax returns. Ask your lender what their process includes, since a fully underwritten pre-approval carries more weight with sellers.

 

2.2 Secure the Funds

In addition to a pre-approval letter, you will need proof of funds when making an offer. If you need to move money between accounts, do it early so your financial picture is clear. If any part of the funds will be a gift from a parent, spouse or another party, disclose it upfront; some sellers request proof of funds from the person providing the gift. For co-ops, confirm whether gifting, parents buying for children and co-purchasing are permitted, since each building has its own rules.

 

2.3 Fill Out the REBNY Financial Statement

The REBNY Financial Statement is the standard form used throughout New York City to present your financial profile. It summarizes your assets, liabilities, income and expenses so the seller can judge your strength and ability to close. It matters most in co-op purchases, where financial review is more detailed. Prepare it carefully with supporting documents such as bank and investment statements and loan information. A complete, accurate statement shows that you are organized, transparent and qualified.

 

 

Step 3: Find Your Home

 

3.1 Select the Neighborhood

Consider affordability, your commute, schools, and the lifestyle you want day to day. Spend time in the neighborhoods you are considering: visit shops, restaurants and parks at different times of day. Your agent can help you compare pricing, building stock and resale trends between areas.

 

3.2 Shop Around

Review the listings your agent sends based on your criteria, and browse on your own to get a feel for the market. As your search narrows, eliminate neighborhoods and properties that do not match your priorities or budget. Your agent should track price changes, days on market and listing history to show you which homes are fairly priced, overpriced or likely negotiable.

 

3.3 Tour Apartments

Touring in person is essential. It gives you a true sense of space, layout and natural light that photos cannot capture. Open closets and cabinets, pull back curtains, step onto outdoor space, and ask questions regarding building rules, utilities, maintenance and recent upgrades.

 

For any apartment you are seriously considering, schedule a second showing and treat it as a pre-inspection. Look inside cabinets and under sinks, test the water pressure, run the air conditioning, and look carefully for signs of leaks or water damage on ceilings and walls. Catching these details early leads to a more confident offer.

 

Compass Private Exclusives

Compass Private Exclusives are homes that are shared within the Compass network before, or instead of, being marketed publicly. For buyers, that early visibility is a real advantage: you may be able to see a home and make an offer before it reaches the broader market, often with less competition.

 

Sellers choose to start privately for many reasons, including a change in finances, a family transition, a relocation, privacy, valuable belongings in the home, or a preference to avoid public marketing and open houses. As a Compass agent, I can show you these homes alongside everything on the open market.

 

 

Step 4: Make an Offer & Sign the Contract

 

After weighing the pros and cons of the homes you have seen, you have found the one. Here is how the offer and contract stage works.

 

4.1 Evaluate the Market

To determine a fair offer, your agent will prepare comparable sales ("comps") of similar homes that recently sold nearby and help you build an offer strategy based on market conditions, value and room for negotiation. Having your own agent also avoids the conflict of interest that can arise when the seller's agent represents both sides; the seller's agent likely helped set the price and may naturally defend it, even if the home was listed high.

 

4.2 Submit a Formal Offer

Your offer should include the price, financing terms, proposed closing timeline and any contingencies. Presentation matters almost as much as price. Two buyers may offer similar amounts, but the one with a cleaner, more complete package (terms, attorney information, pre-approval, proof of funds and REBNY Financial Statement) often looks more serious and more likely to close, and can win even against a slightly higher offer.

 

Be ready for a bidding war

In a competitive market, a strong first offer can give you an advantage. To make your offer stand out, consider a larger down payment, flexibility on the closing date, and fewer contingencies where it is prudent to do so.

 

Avoid emotional attachment

Counteroffers and rejections are common. In New York, an accepted offer is not legally binding until both parties have signed the contract, and until then the seller can still consider other offers. Even after signing, a co-op board can still reject a sale, so stay measured until you have the keys.

 

4.3 Negotiate

Making an offer is the beginning of a negotiation. The right starting point depends on market conditions, the property's pricing and the level of competition. In a competitive market you may face multiple bidders; in a softer market you will have more leverage. Set your ceiling before you start, and let your agent guide the strategy.

 

4.4 Review the Contract

Once price, concessions and timing are agreed, the agents prepare a deal sheet and send it to the attorneys. The seller's attorney drafts the contract, and your attorney reviews it along with the building's financial statements, board minutes and offering plan or proprietary lease, negotiating revisions if needed. A responsive attorney who has time for your deal is essential.

 

4.5 Conduct a Home Inspection

While your attorney reviews the contract, have the apartment inspected. An inspection usually takes one to three hours and typically costs $500 to $800 for a condo or co-op. If it uncovers significant issues, you can ask the seller to fix them before closing or request a credit, documented in a contract rider.

 

Inspection reports are very detailed and will note even minor cosmetic wear. Most NYC apartments are sold "as is," meaning the seller is not obligated to make cosmetic repairs. Functional issues are different: leaks, mold, electrical problems, cracked pipes or appliances that do not work are reasonable items to negotiate. Your agent will help you separate the two.

 

4.6 Sign the Contract and Wire the Deposit

You sign the contract and wire the contract deposit, typically 10% of the price, to the seller's attorney's escrow account. The seller then countersigns, and the contract is fully executed.

 

4.7 Title Search or Lien Search

Right after signing, your attorney orders a title search for a condo or house, which confirms legal ownership and checks deeds, tax liens, judgments and other records. For a co-op it is a lien search, since co-op apartments do not have individual titles. Any issue found must generally be resolved before closing.

 

 

Step 5: Get the Loan Commitment Letter

 

Most co-op and condo boards require a loan commitment letter before they will review your board package. It must be "clean," meaning all conditions (especially anything related to building approval) are cleared. This is different from the conditional commitment your lender issues shortly after contract signing. While you work toward the clean letter, start assembling your board package so it is ready to submit.

 

5.1 Secure the Loan

This step often takes the longest. Even with a pre-approval, your lender will request additional documents, such as:

 

• Updated bank statements

• Recent pay stubs or income verification

• Employment verification, especially after a recent change

• Letters explaining large deposits or gifts

• Proof that funds are in a U.S. account (for international buyers)

• Confirmation of any outstanding debts

 

Respond quickly and accurately to keep your loan, and your closing date, on schedule.

 

5.2 Get an Appraisal

Your lender orders an appraisal to confirm the property's value supports the loan. The appraiser considers layout, square footage, condition and recent comparable sales. You can ask the lender to confirm the appraiser is licensed and experienced in the neighborhood. Appraisal fees, paid by the buyer, typically range from $400 to $1,500 depending on size and complexity.

 

 

Step 6: Board Application (Condos and Co-ops)

 

Once you have your loan commitment, the next step is the board application. Condos and co-ops require buyers to meet standards set by the building's board, and a complete, polished package makes a real difference.

 

Co-op Boards vs. Condo Boards

Co-op boards are the most thorough. They have broad discretion, may request additional documents, and interview every buyer; approval is not guaranteed. Condo boards are typically less restrictive and focus on financial stability and building rules; most condos have a right of first refusal that is usually waived. Single-family and multifamily homes have no board approval, so you proceed directly to closing after contract and inspections.

 

Timing

Once a complete package is submitted, review often takes one to two weeks, although timing varies and delays can occur if the board requests more information.

 

6.1 Prepare Your Documents

A board package typically includes:

 

• Financial documents: tax returns, pay stubs, bank and investment statements, and proof of funds

• Personal information: personal and professional references, employment history and reference letters

• Purchase details: the signed contract and loan commitment letter (if financing)

• Application forms and fees: each building has its own forms and processing fees

 

Use a checklist, follow the building's instructions exactly, and respond to follow-up requests quickly.

 

6.2 The Co-op Interview

Co-op boards interview buyers before approving a sale. Dress professionally, arrive on time, know what you submitted, and show that you intend to be a responsible, long-term member of the building. The board usually decides within a few days.

 

 

Step 7: Closing

 

7.1 Get Homeowners Insurance

Your lender will ask for proof of homeowners insurance before issuing a clear to close. For condos and co-ops this is an HO-6 policy that covers your interior, belongings and liability. Bundling home and auto policies can lower your premium.

 

7.2 Clear to Close

After reviewing the appraisal, title report, insurance and updated financials, your lender issues a "clear to close," confirming that all underwriting conditions are met and you are ready to sign your loan documents.

 

7.3 Schedule the Closing

The attorneys coordinate a closing date with the lender, both agents and the title company. Closings typically take place at an attorney's office, the managing agent's office (for co-ops) or a title company. Your attorney will confirm the final figures and the funds you need to bring.

 

7.4 Final Walk-Through

Shortly before closing, walk through the home to confirm it is in the agreed condition and that any agreed repairs are complete. Go in daylight, turn on every light, run the faucets, test appliances and look for new leaks or damage. If something is not as agreed, you can request a credit or repair at closing.

 

7.5 Title Insurance

For a condo, townhouse or house (not a co-op), you will purchase title insurance, which protects you and your lender against ownership disputes, liens or claims that surface after closing. The premium is a one-time charge paid at closing.

 

7.6 Close the Deal

On closing day you sign the documents that transfer ownership, and the funds are wired. Your share typically includes the balance of the purchase price and your closing costs: mortgage recording tax (condos and houses), mansion tax (purchases of $1 million or more), title insurance, attorney and lender fees. Once everything is signed and funded, the deed is recorded and the home is officially yours. Congratulations!

 

 

Step 8: Post-Closing

 

Before settling in, complete these tasks for a smooth transition:

 

• Coordinate with the managing agent: schedule your move, reserve the elevator and pay any move-in deposits

• Transfer utilities: set up electricity, gas and internet, and confirm what your common charges or maintenance include

• Change your address: update USPS, your bank, employer, insurance and subscriptions

• File for tax abatements: if eligible, apply for the NYC Co-op and Condo Abatement or the STAR credit; ask your accountant

• Keep warranties: save warranties for appliances and building systems included in the sale

• Secure your documents: store your closing documents, title policy, insurance, and co-op stock certificate and proprietary lease safely

 

 

Co-op vs. Condo

 

Owning a condo is similar to owning a house: you receive a deed to a specific unit. Owning a co-op means you own shares in the corporation that owns the building, along with a proprietary lease for your apartment. Condos usually cost more to close on but offer more flexibility.

 

• Share of NYC housing: Co-op: Majority of Manhattan's for-sale apartments; many prewar and postwar buildings. Condo: Smaller share; most new development is condo.

• Ownership: Co-op: Shares in a corporation and a proprietary lease. Condo: Deeded real property.

• Typical down payment: Co-op: 20% to 25% minimum, some 30%+. Condo: As little as 10%.

• Board approval: Co-op: Thorough review and interview. Condo: Right of first refusal, usually waived.

• Post-closing liquidity: Co-op: Often 12 to 24 months of carrying costs. Condo: Generally lender reserves only.

• Closing costs (buyer): Co-op: Approximately 1% to 2%, plus mansion tax. Condo: Approximately 3% to 5% when financed.

• Monthly costs: Co-op: Maintenance (includes real estate taxes). Condo: Common charges plus separate taxes.

• Renting out: Co-op: Limited; sublet rules vary by building. Condo: Generally flexible.

• Investor friendly: Co-op: Rarely. Condo: Yes.

 

 

Buyer Closing Costs

 

The tables below summarize the closing costs a buyer typically pays in New York City. Rates for taxes reflect current New York State and New York City schedules; fees vary by lender, building and title company.

 

Co-op Purchase

• Your attorney: $2,500 to $5,000+

• Lien search: $350 to $500

• Lender fees (application, credit check, bank attorney): $1,500 to $2,500

• Appraisal: $400 to $1,500

• Lender points (if any): 0% to 2% of the loan

• Recognition agreement & UCC-1 filing: $300 to $500

• Board application, credit check & move-in fees: $1,000 to $2,500

• Move-in deposit: $500 to $1,500, refundable

• Maintenance adjustment: Prorated for the month of closing

• Mansion tax: Purchases of $1M or more, see schedule

 

Condo Purchase

• Your attorney: $2,500 to $5,000+

• Lender fees (application, credit check, bank attorney): $1,500 to $2,500

• Appraisal: $400 to $1,500

• Lender points (if any): 0% to 2% of the loan

• Mortgage recording tax: 1.80% of the loan under $500,000; 1.925% at $500,000 or more

• Title insurance (owner's and lender's policies): Approximately 0.4% to 0.5% of the price

• Recording fees & municipal searches: $500 to $1,000

• Real estate tax escrow: 2 to 6 months of taxes, set by the lender

• Board application, credit check & move-in fees: $750 to $2,500

• Common charge & tax adjustments: Prorated at closing

• Mansion tax: Purchases of $1M or more, see schedule

 

New Development Condo (in addition to condo costs)

• NYC transfer tax (paid on the sponsor's behalf): 1.00% under $500,000; 1.425% above $500,000

• NYS transfer tax (paid on the sponsor's behalf): 0.40%; 0.65% at $3M or more

• Sponsor's attorney fee: Often $2,500 to $5,000

• Working capital contribution: Often 1 to 2 months of common charges

 

New York State Mansion Tax (paid by the buyer)

• $1,000,000 to $1,999,999: 1.00%

• $2,000,000 to $2,999,999: 1.25%

• $3,000,000 to $4,999,999: 1.50%

• $5,000,000 to $9,999,999: 2.25%

• $10,000,000 to $14,999,999: 3.25%

• $15,000,000 to $19,999,999: 3.50%

• $20,000,000 to $24,999,999: 3.75%

• $25,000,000 or more: 3.90%

 

The rate applies to the full purchase price, so pricing just below a threshold can matter. On a $2,000,000 purchase, the mansion tax is $25,000; at $1,995,000 it is $19,950.

 

Run Your Numbers

Open my NYC Real Estate Calculator. Enter a price, property type, down payment, rate and term to see your monthly payment, an itemized estimate of your closing costs, the total cash you need, and the income a co-op board may look for. Open the NYC Real Estate Calculator