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Yardy, Home Buyer in Queens, NY

How come NY state real estates transfer tax is so high? Is there any discount for vet .?

Asked by Yardy, Queens, NY Sun Dec 6, 2009

On my good faith estimate the one fee I have problem with is NY state real estates transfer tax .

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Sean - buyers and sellers each pay 2% of the contracted purchase price?...... consumers buying a home for $500,000 pay $10,000 each? That's really high. A 500,000 sale wouldn't have such a high fee here.

Here, the seller pays the "realty transer tax".......and it's on a graduated scale, depending on the price....senior citizens get a discounted rate.
Buyers do pay a mansion tax,however.............as I said, that's 1%, starting at 1 million.

Buyers pay for the title insurance.
1 vote Thank Flag Link Mon Dec 7, 2009
Robin,

What you say is true. Since transfer taxes are a seller's issue, I was responding to the seller's perspective.
0 votes Thank Flag Link Wed Mar 24, 2010
Michael, if someone does a purchase CEMA they save on mortgage tax too. That works best if the current loan balance is similar to the new loan. If the seller has a small balance, and the buyer is taking out a large mortgage, it may not make sense.
0 votes Thank Flag Link Wed Mar 24, 2010
By the way, there are no discounts. However, the New York State tax can be reduced by a buyer assuming the seller's mortgage. The mortgage balance is subtracted from the purchase price before calculating the tax.
0 votes Thank Flag Link Tue Mar 23, 2010
The New York State transfer tax is $2 per $500 or part thereof of the contract price, payable by the seller. Since the vast majority of purchase prices are whole thousands, this is commonly cited as $4 per $1,000. For instance, on a $500,000 purchase price, the tax would be $2,000. A purchase price of $500,250 would yield a tax of $2,002. On purchase prices of $1,000,000 or more, there is the mansion tax of 1% payable by the buyer.

New York City and Yonkers also have local transfer taxes payable by the seller. The New York City tax is 1% of residential sales of $500,000 or less and 1.425% over $500,000. There is also commercial rates of 1.425% on sales of $500,000 or less and 2.625% over $500,000. In Yonkers, the tax is 2.75% payable by the seller.

In the Hamptons, there is the Peconic Bay tax of 2% for developed properties with a $250,000 exclusion and 1% for vacant land with a $125,000 exclusion paid by the buyer.

All of the seller's taxes can be passed along to a buyer as part of the contract, but it is highly unusual except when purchasing from a developer. When buying new construction, it is the norm for the buyer to pay all the developer's closing expenses in addition to the contract price. Both New York State and New York City consider this as part of the purchase price and include it in the calculation of the transfer tax.
0 votes Thank Flag Link Tue Mar 23, 2010
This is an old question, but came up when I was checking something about transfer tax. It is not NY State transfer tax that is so high, it is NY City. This is a seller's expense unless it is new construction, a short sale or a foreclosure. Because of the new RESPA guidelines that went into effect on January 1st, lenders and mortgage brokers are now disclosing this as a cost on the good faith estimate, even though in most instances you do not pay it.
NY State transfer tax is $4 per thousand of purchase price. NY City transfer tax is additional, 1% up to a $500,000 purchase price, 1.425% over that. In NYC the mortgage tax is also higher. 1.8% total on mortgage amount.
0 votes Thank Flag Link Tue Mar 23, 2010
Here in philadelphia the total transfer tax is 4%

Buyers pay 2% and sellers pay 2%.
Web Reference: http://www.SeanDawes.com
0 votes Thank Flag Link Mon Dec 7, 2009
Yardy - if it's any consolation, the transfer tax is NJ is extremely high, too........it was .increased tremendously during McGreevey's tenure as governor. We also have a mansion tax (think NY has it, too). Buyers pay 1% of the purchase price for homes sold over 1 million.

I am sure some NY agent will come along and let you know about any discounts that are available. In NJ, we have a senior citizen disocount............almost makes one want to get old.....fast!!

Good luck!
Debbie
0 votes Thank Flag Link Mon Dec 7, 2009
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