What Is the Average Down Payment for an Apartment in NYC?

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What is the average down payment for an apartment in New York City? We will demystify this topic in the following video. I'm Nick at Hauseit. Visit our website https://www.hauseit.com to learn about ways to reduce your closing costs and save money when buying and selling in New York City, so let's get started.

The average down payment for an apartment in New York City is 20%. While it's possible to put down 10% or less on many condos in the city, most co-op buildings have minimum down payment requirements of 20%. Condo buildings in New York City often have minimum financing requirements as well. If a condo building in New York City does not have a minimum down payment requirement, how much your down payment is will ultimately come down to what loan-to-value your bank is willing to lend to you at and what the seller is willing to accept? For obvious reasons, sellers are most attracted to all cash and or non-contingent offers because these deals have a higher certainty of actually going through. If you're putting down 5% to 10% and have a mortgage contingency, a seller will only agree to do a deal with you as a last resort if there are no other offers.

Furthermore, a seller may demand a higher sale price as compensation for the increased risk of selling to someone with shakier financing terms. If you're buying a co-op apartment, the amount of your down payment is a key measure of your financial qualifications which will be reviewed as part of the co-op board application process. Typical co-op financial requirements in New York City include a minimum down payment, sufficient post-closing liquidity and a minimum debt to income ratio which is usually 25 to 30%. How much cash you need to buy an apartment is actually slightly more than your down payment due to buyer closing costs.

You can estimate your buyer closing costs in New York City using Hauseit's interactive calculator available at https://www.hauseit.com/closing-cost-calculator-for-buyer-nyc/.

How do down payments work? It's customary in New York City for buyers to put down at 10% earnest money deposit upon signing a purchase contract. The deposit is held in an escrow account maintained by the seller’s attorney. If you're putting down 20%, this means that you'd pay the remaining 10% at closing. If you're putting down just 10% and the contract deposit is 10%, this means that you would not need to contribute any additional down payment monies upon closing. If you have a mortgage contingency, this clause allows you to back out of a deal and recoup your contract deposit under certain conditions.

While the amount of the contract deposit is negotiable, it's extremely rare for a seller to accept anything less than the customary 10%. How much are buyer closing costs in New York City? Well, buyer closing costs are substantial and can add up to an extra 2% to 4% on top of your purchase price. Condo buyer closing costs are closer to 4%, while co-op buyer closing costs come in slightly lower around 2% for a typical financed purchase. Closing costs for buyers who purchase a new construction condo unit directly from a sponsor or even higher and they can range from 5% to 6%.

Again, you can estimate your buyer closing costs in New York City using our free and interactive calculator which is available at https://www.hauseit.com/closing-cost-calculator-for-buyer-nyc/. We hope you found this video helpful, I'm Nick at Hauseit, check out our website https://www.hauseit.com for any questions you may have about buying or selling and for ways to save money if you're looking to do a deal sometime in the near future. If you like this video, do us a favor leave us a comment like and subscribe and we'll see you on the next one!

Save 2% When Buying in NYC: https://www.hauseit.com/hauseit-buyer-closing-credit-nyc/
NYC Buyer Closing Cost Calculator: https://www.hauseit.com/closing-cost-calculator-for-buyer-nyc/
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