Glossary
The vocabulary of Manhattan property, in plain English. Every guide on this site leans on these.
- Board package
- The application a co-op (and the odd condo) requires from a buyer: financial statement, tax returns, reference letters, and more. You assemble it with your agent. The board judges it.
- Classic six
- A pre-war layout: living room, formal dining room, kitchen, two bedrooms, and a small maid’s room. Sevens and eights count rooms the same way.
- Common charges
- The monthly building fee condo owners pay. Property tax is not in it; condo owners get that bill separately. Remember this when comparing against co-op maintenance.
- Contract deposit
- The 10% of the purchase price handed over at contract signing and held in escrow. Walk away after signing and you generally lose it.
- Escalation clause
- An offer term that automatically increases your bid up to a cap if competing offers appear. Common in bidding wars.
- FARE Act
- The 2024 NYC law, in force since June 2025, that makes whoever hires a rental broker pay that broker. It ended the tenant-paid fee for brokers the landlord hired.
- Flip tax
- A transfer fee the co-op building charges when a unit sells, commonly 1 to 3%, usually paid by the seller. Each building sets its own. It feeds the reserve fund.
- Guarantor
- A person (typically earning 80x the monthly rent, usually tri-state) or a paid institutional service that guarantees your lease when your income falls short of 40x.
- HDFC co-op
- An affordable co-op: below-market prices in exchange for income caps and resale restrictions. The rules vary by building and they are strict. Read them before you offer.
- Maintenance
- The monthly fee co-op shareholders pay. The building’s property tax and any building mortgage are inside it, which is why it looks higher than condo common charges.
- Mansion tax
- A buyer-paid tax of 1 to 3.9% on residential purchases of $1M and above, charged on the full price. The reason so many deals close at $999,999.
- Mortgage recording tax
- A tax of 1.8 to 1.925% of the loan on condo and townhouse mortgages. Co-op purchases are exempt, because shares are not real property.
- Offering plan
- The legal document behind a condo or co-op development: finances, rules, sponsor obligations. Your attorney reads it so you don’t have to. Skim it anyway.
- Pied-à-terre
- A part-time home. Fine in most condos. Restricted or banned by many co-op boards.
- Proprietary lease
- The lease a co-op corporation grants a shareholder for their unit. It’s the document that makes a co-op apartment yours to live in.
- Rent-stabilized
- A unit whose rent increases are capped annually by the Rent Guidelines Board and whose tenant has the right to renew. About a million units citywide.
- Right of first refusal
- A condo’s lighter alternative to board approval: the building may buy the unit itself instead of letting your deal proceed. It almost never does.
- Sponsor unit
- A unit sold by the original developer or owner rather than a resident. In co-ops these often skip board approval, and they’re priced like it. Buyers usually pick up extra closing costs.
- Underlying mortgage
- Debt the co-op corporation carries on the whole building, paid down through everyone’s maintenance. Part of what your attorney checks in the building’s financials.