Buying in Manhattan
What Buying Really Costs: Closing Costs and the Mansion Tax
Plan on 2 to 5% of the price on top of your down payment, more for new development. Here's the itemized damage.
Facts, figures and legal references on this page were verified against public sources in August 2026. Rules change; confirm anything decision-critical with your attorney or agent.
The down payment is not the whole check. Closing costs in Manhattan run roughly 2 to 5% of the purchase price on top of it, and the mix depends on whether you’re buying a co-op or a condo, with a mortgage or without.
The two taxes everyone learns the hard way
Mansion tax. Buyer pays it on any home of $1M or more. It starts at 1% and climbs in steps to 3.9% above $25M, and it applies to the whole price, not the amount over the line. At $999,999 you owe nothing. At $1,000,000 you owe $10,000. One dollar of price, ten thousand in tax. That cliff is why so many Manhattan deals close at $999,999.
Mortgage recording tax. 1.8% of the loan under $500K, 1.925% at $500K and up. It hits condos and townhouses only. Co-op buyers skip it entirely, because shares in a corporation aren’t real property. This is one of the co-op’s quietest financial advantages.
The itemized bill
| Item | Co-op | Condo |
|---|---|---|
| Mansion tax ($1M and up) | 1 to 3.9% | 1 to 3.9% |
| Mortgage recording tax | None | 1.8 to 1.925% of loan |
| Your attorney | $2,000 to $4,000 | $2,000 to $4,000 |
| Bank fees, appraisal | $1,500 to $3,000 | $1,500 to $3,000 |
| Title insurance | None | About 0.4 to 0.5% of price |
| Building and managing agent fees | $2,000 to $5,000 | $2,000 to $5,000 |
| Lien search, UCC filing | A few hundred | None |
No mortgage recording tax and no title insurance is why co-op closings run lighter: often 1 to 2% all-in, against 3 to 5% for a mortgaged condo.
New development reads differently
Buy from the developer (a sponsor unit) and tradition says you pick up costs the seller normally pays: the city and state transfer taxes, roughly 1.4 to 2.075% combined depending on price, and sometimes the sponsor’s attorney fee. In a soft market these are negotiable. Make your attorney ask, because the sponsor won’t offer.
What sellers pay, for context
The broker commission (typically 5 to 6%, split between the two sides), transfer taxes, their own attorney, and in most co-ops a flip tax. A flip tax is a transfer fee the building charges on the way out, commonly 1 to 3%, set by each building to feed its reserves. Knowing the seller’s costs tells you how much room they actually have to move.
Rules of thumb
- A $1.5M condo with 20% down: about $300K down plus $70K to $90K in closing costs, before the movers or a coat of paint.
- Co-ops want post-closing liquidity on top: often one to two years of maintenance and mortgage payments still in your accounts after the closing. Count it before you offer.