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Finding an apartment in a city as large and varied as New York can be a complex process.  The rules are different here than in other parts of the country.  For the inexperienced, some of the differences may be perplexing.  But with proper guidance and information, you’ll find that it’s not nearly as difficult as it seem. This guide will help you navigate the apartment hunting experience, and make your purchasing process as smooth and low stress as possible.

1. Why Invest in NYC Real Estate

Manhattan real estate is the most expensive and recognized market in the U.S.  While the U.S. real estate has experienced a historical home price decline, Manhattan remains to be one of the most stable cities in the country.   There are many reasons for properties to retain their value in Manhattan, such as low vacancy rate, limited landmass, diversified demand base, and others factors.  Globally, Manhattan has always been attractive to international buyers and it is a bargain when compared to cities like London, Paris and Hong Kong.

Why Invest in NYC Real Estate
2. Types of Properties in NYC

New York is a city comprised mainly of condominium (“Condo”) and cooperative (“Coop”) apartments with a smaller selection of private homes, which we call townhouses or brownstones. Most important is understanding the differences between the types of apartments you will find in Manhattan.

For investment purpose, buying a condo is a better option than a Coop apartment.  Coop buildings often restrict ability to rent, thus reduce their attractiveness as an investment property.  In addition, the process of buying a Coop is subject to board approval, which prolongs the buying process, and a Coop board may reject a buyer.  However, since Coop boards are very selective with people who will be living in the building and often restrict rental activities, there are fewer transient residences.  Many people prefer living in Coop building for that reason.  It is also much cheaper than Condo.  


Townhouses are standing along building and can include one or more dwelling units or mixed use with both residential and commercial components.  Townhouses comprised a very small portion of the real estate market in Manhattan.  


Condo apartments are rapidly growing in number and popularity as new buildings are constructed.  The purchase of a Condo apartment is much like buying a house in which a deed and formal title transfer occurs.  Each individual Condo apartment receives its own tax bill and pays monthly common charges, which cover building operating expenses such as staff, repairs, insurance, etc. Depending on the lender, up to 90% of the purchase price of a Condo may be financed.  This coupled with the more straightforward nature of the purchase application and ease of subletting, makes Condo a better choice for certain buyers, and especially for investment purchases.  Generally, the only way a Condo board can block a sale or reject a potential tenant is to buy the apartment or pay for the rent asked.  This is known as the “right of first refusal” and is rarely used because it typically requires a vote of the unit owners, and the Condo association must come up with the money.


The concept of Coop is limited almost entirely to the New York metropolitan area where a large percentage of apartments are in Coop buildings.  What makes this form of property ownership unique is that residents do not actually “own” their “apartments”, rather, they own shares of the cooperation that owns their building and have the exclusive right to use and occupy their apartment by way of a proprietary lease.  Shareholders pay a monthly maintenance fee that covers each owner’s proportionate share of building expenses such as heat, insurance, real estate taxes and the underlying mortgage expenses.


The board of directors in the Coop has the ability to determine what financing is allowed for purchases. The minimum down payment is typically 20% or 25%; however this can vary depending on the building.  The board also reviews the purchasing application and subleasing can sometimes be difficult in a Coop building.  Different from the Condo board, the Coop board can reject the buyer or the tenant, and the owner will have to start the sales process or a search for a tenant again if this happens.

NYC Apartments Year Built - Condo vs. Coop

Condo Built
Types of Properties in NYC
3. Real Estate Professionals

A real estate transaction in Manhattan typically involves real estate agents and lawyers representing the buyer and seller.  If you are taking a mortgage, then there will be a mortgage lender and an appraiser.  You may also want to consider a tax specialist to handle the tax structure after purchase the property. 

Real Estate Agents

A good real estate agent can guide you through every step of the process and assist you on a smooth closing, not merely provide access to view.  In New York, all agents, through the Real Estate Board of New York (REBNY), have access to the entire inventory of properties for sale.  In addition, the seller is represented by one agent through the exclusive agreement; therefore, it is not recommended for a buyer to use multiple agents since it only creates confusion.   In Manhattan, agent fees are typically incorporated in the asking price. When the seller’s agent agrees to list a property for sale, a certain percentage is agreed upon as commission and the seller’s agent will coordinate on all property showings and assist the seller throughout the transaction.  If you are represented by an agent, this pre-negotiated commission would be split between you and the seller’s agents.  If you do not have an agent, then the seller’s agent keeps the entire pre-negotiated commission.  Hence, it is in your best interest to have agent representation to help you through the process and negotiate the best price.

Real Estate Attorney

In New York City, there are always real estate attorneys representing buyer and seller in a transaction from the very beginning of the process.  When an offer is accepted, the seller’s attorney will contact your attorney on the terms of the contract, and your attorney will begin to conduct due diligence on the property.  You would typically need to deliver 10% of the purchase price as deposit to be held in an escrow account.  The attorney will also coordinate the closing with various parties.

Mortgage Specialists

If you are considering taking a mortgage, a brief conversation with a mortgage broker or banker before you start searching for the property will likely clarify your borrowing power. The mortgage professional will verify your income, assets, liabilities, and perform a credit check. Once your liquid assets and borrowing potential are determined, a pre-approval letter can be issued.  Many sellers will request to see the pre-approval letter from the bank or proof of fund when reviewing the offers. 

Participating Professionals
4. The Process Step by Step

The timing for the entire purchase process – from the day you identify the right apartment to closing varies greatly, but you should reasonably expect it to take between 1 - 3 months if it is a cash purchase and 3 - 5 months if financing is involved. Below is a summary of the purchase process.

1. Retain real estate professionals (1 to 3 days)


Identify a Real Estate Broker to assist you in the process, and speak with a mortgage specialist and get pre-approval


2. Identify the Property (varies)


The length of your apartment search will vary depending on what you are looking for, what may be available at any given time, and your personal purchasing style. I will identify listings, schedule your viewing appointments, and coordinate open house tours.


3. Negotiating for the Apartment (2 days to 2 weeks)


The three key points for the buyer and seller to agree on are price, closing date, and contingencies. In addition, personal property, such as appliances, window treatments, fixtures, furniture, rugs, etc. must be addressed.  While all things are negotiable, I recommend that you start the negotiation with a reasonable offer.  New York City is a very transparent and efficient market; unrealistic offer can only delay the process and allow other buyers opportunity to make offers that may be better than yours.  In a seller’s market when bidding war is common, it is not uncommon that the accepted offer is above asking.


4. Signing the Contract (1 weeks)


In New York City, both the buyer and the seller are represented by real estate attorneys. The seller’s attorney drafts the contract after an offer is accepted. The buyer’s attorney performs the due diligence, which includes reviewing the building’s offering plan, financial statements and reading the board meeting minutes. Once all the contractual terms are agreed upon, the buyer signs and returns the contract to the seller’s attorney along with a deposit, typically 10% of the agreed upon sales price. The seller then countersigns the contract and the deposit is placed into an escrow account until closing. The contract is binding only after it has been signed by both parties and returned to the buyer. Until the contract is dually executed, neither party is legally obligated to close the deal.  Seller’s agent may continue to show the property and the seller can accept higher offers.


5. Obtaining a Mortgage Commitment Letter (2 to 6 weeks)


Once the contract is signed, you will need to obtain a commitment letter from the lender.  The lender will require an appraisal done on the property, and they will review the buyer and the building’s qualifications to ensure that the lender’s underwriting requirements are met before issuing a commitment letter.


6. Completing Your Purchase Application and/or Board Package (3 to 8 weeks)


Whether you purchase a condo or a Coop, you will need to prepare for the board package.  Purchase of a Coop apartment requires board approval and the purchase of a Condo unit requires a waiver of right of first refusal. The board for the building will provide its customized application, generally minimal information needed for a condo building, but much more extensive for a Coop.  Preparing for the board package can be a stressful task, therefore, you should start collecting the necessary documents as early as you can.  As your agent, I will assist you in complete, compile, and put the finishing touches on your board package/application. (see Board Package Basics)


7. Submit Board Package/Condo Application (2 to 5 weeks)


I will forward the completed package to the building’s managing agent. The managing agent will review and forward it to the Board for consideration.  Once the board reviewed the package, a Coop board will most likely request an interview with the potential buyer; where as the Condo board will issue the right of first refusal and the closing can be scheduled.


8. Meeting with the Coop Board – Board Interview (Coops Only*) (1 to 2 days)


Each Coop board is unique, but typically a board will meet once a month. The meetings tend to be held on weeknight evenings. It is considered a good sign to be invited for a board interview; however this does not guarantee board approval. Generally, the managing agent will notify the seller’s agent, a day or two after the interview, that the potential buyer either receives board approval or is rejected.


9. Schedule Closing (1 to 2 weeks after board approval)


The attorneys, managing agent, lender and the title company will coordinate a mutually agreeable date and time for closing.  All of these parties may need to attend.  Buyer or seller does not need to attend the closing in person.  If he or she does not chooses not to attend the closing, he or she will need to have a power of attorney executed in advance.   At the closing, all remaining payments will be tie out, and the keys will be delivered to the buyer.

Home Buying Process
The Process Step by Step
Closing Costs
Closing Costs

Estimate Closing Cost in NYC

Estimated Buyer Closing Costs.png

Disclaimer: Costs can change and vary for some transactions. All information is subject to errors, omissions and changes in facts or circumstances. Always consult your attorney before signing a contract.

Manhattan Neighborhood Map
6. Manhattan Neighborhood Map
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