How Much Are Buyer Closing Costs for a NYC Townhouse?

A typical buyer is going to pay anywhere from 2% 4% of the purchase price in buyer closing costs when purchasing a townhouse (also known as a brownstone) here in New York City. You can reduce your closing costs by requesting a Hauseit Buyer Closing Credit: https://www.hauseit.com/buyer-closing-credit/

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Closing costs for a townhouse are largely driven by two specific items, the first being the mansion tax and the second being the mortgage recording tax. As a result, your closing cost bill depends on two associated factors. Number one, the purchase price. The mansion tax itself is a progressive tax structure with many different tax brackets therefore, the higher your purchase price, the higher percentage you will have to pay for the mansion tax. As a result, to reduce your buyer closing costs in New York, you could potentially spend less money and you'll fall into a lower mansion tax bracket.

The second determinant of your closing costs of course is, whether or not you're financing and that's because the mortgage recording tax certainly is only applicable to people who are financing. The size of your loan is what determines the amount of your mortgage recording tax bill. If you're putting down 85% and financing 15%, your mortgage recording tax bill will be very low, but if you are financing 95 of your purchase, of course, the loan size will be substantial and as a result the mortgage recording tax bill will also be meaningful.

So, to go into extremes, if you end up say, buying a townhouse in New York City, that's under a million dollars. If you somehow managed to discover something like that, they do exist by the way but not in the areas that most people are considering such as Brownstone, Brooklyn. But let's say you find something that's under a million and you're paying all cash, in that case, your closing cost bill will actually be significantly less than 2%. You have no mansion tax because you're below a million and you have no mortgage recording tax because you're not financing.

Now, on the flip side, if you're buying a substantial townhouse, let's say a 5 or 10 or 15 million type of property and you are financing a fair bit of the purchase. Let's say you know 70%, you’ll have a massive closing cost bill and that's because you're paying a very high mansion tax percentage and of course you have a substantial mortgage loan size which will translate into a
high mortgage according tax bill.

So, the third buyer closing costs for townhouses that is meaningful is title insurance.

So, just to summarize the three largest closing costs for townhouses in New York City include the mansion tax, the mortgage recording tax as well as title insurance. Now, outside of these three main ones, you have a few other incidentals for starters. You have buyer closing costs
associated with your attorney. Now outside of attorney fees of course, you have other you know, various incidental type fees. For example, if you're financing, you will have a loan application fee, you'll have an appraisal fee. Those are usually around seven hundred and fifty dollars to a thousand dollars each. You'll also have the fee for the bank's attorney, the lender's attorney that you pay for as the borrower and you also have various filing related fees for your mortgage.

Other types of miscellaneous type closing costs also include recording fees for your actual title and some fees associated with your title search but the collective amount of these random fees is extremely insignificant relative to the first three closing costs that we've mentioned and the typical purchase price of a townhouse in New York City.
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Save money when buying, selling and renting real estate in New York and Florida with Hauseit (https://hauseit.com). Available in NYC, Long Island, the Hudson Valley and South Florida. Est 2014.

Hauseit Group LLC, Licensed Real Estate Corporation
Tel: (888) 494-8258 | https://www.hauseit.com
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