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New York City is one of the most diverse and competitive real estate markets in the world, and we understand thot making the decision to buy a home here con be a particularly overwhelming experience. From mastering the difference between condos and co-ops, to planning for closing costs, to approaching the board approval process, there‘s a lot to learn.
Thot’s why we’ve created this buyer’s guide— to set you on the right course to owning a New York City home of your own.
Look for a licensed real estate agent who is knowledgeable about the neighborhoods you’re considering and can help guide your search.
Before beginning your search, your first step is to get pre-approved for a mortgage loan (unless you will be paying in cash for the full price of your home). Your Compass agent can connect you to a mortgage broker. Based on your income and credit history, the mortgage broker will determine how much the bank will lend you, which will help you determine the price range for your search.
Attend viewings and open houses spanning a range of areas and property types. Now is the time to consider your ideal home’s location and amenities.
Reach an agreement with the seller on price and terms. Once you have seen a home you like, you can put in an “offer,” which is a non-binding agreement to pay a certain price for the home. If your offer is lower than the list price, the seller will likely return with a “counter offer” price, which you can choose to accept, reject, or make another offer. Your Compass agent will provide advice on pricing throughout.
Analyze the contract of sale, building financials, and board minutes with your attorney. It’s best to work with an attorney who specializes in New York City co-op and condo sales. Your attorney‘s job is vital to protecting your interests. and they have an incredible amount of paperwork to review on your behalf. Therefore, you want to select an attorney who is familiar with these transactions.
Organize an appraisal with your bank.
(If you are purchasing a townhouse skip ahead to Step 10.)
Co-ops are run by a board of directors, who will require a board package in order for you to purchase an apartment. A board package generally consists of financial documents including tax returns, bank statements, mortgage commitment from your bank, and letters of reference. After reviewing your package, the board will set an interview date. Your Compass agent will help prepare your board package as well as prepare you for your interview. While condos do not generally require board packages or interviews, you will need to present a purchase application that shows you are financially qualified to purchase the apartment.
Congratulations, you are now a homeowner!
Typical Time from Contract to Close: 60 days
Agent Consultation
Mortgage Pre-approval
Select Real Estate Attorney
View Properties
Identify Property, Submit Offer, Negotiate
3 - 5 Days
Accepted Offer
Attorney Due Diligence
Inspection (if applicable)
Buyer Signs Contract
Buyer Submits Deposit Check for 10% of Purchase Price
Seller Signs Contract
“Accepted Offer" is a handshake agreement
Nothing is legally binding until contract is signed by both buyer and seller, and the 10°4 deposit is submitted
Due diligence and contract signing typically only takes about 1 week, but can take longer depending on the management company, scheduling the inspector... etc.
Day 1
Fully Executed Contract Sent to Buyer’s Attorney
Schedule Appraisal
Buyer Begins Mortgage Application
Buyer Starts Purchase Application / Condo Board Package
Bank Issues Commitment Letter
Submit Purchase Application to Boord
Day 30
Board Review of Purchase Application
Each boord is different, but most hove a review period of 30 days or less, during which they can ask for additional documents, explanation...etc regarding your application.
Day 50
Board Issues Waiver of Right of First Refusal
Condos only hold the right of first refusal, which gives them the option to purchase the property at the contract terms (this right is almost never exercised except for in extraordinary circumstances).
Lender Clear to Close
Attorneys Schedule Closing
Issue Closing Disclosure to Buyer TRID Review Period (3 days)
Day 59
Final Walk Through
Day 60
Closing
Typical Time from Contract to Close: 90 days
Agent Consultation
Mortgage Pre-approval
Select Real Estate Attorney
View Properties
Identify Property, Submit Offer, Negotiate
3 - 5 Days
Accepted Offer
Attorney Due Diligence
Inspection (if applicable)
Buyer Signs Contract
Buyer Submits Deposit Check for 10% of Purchase Price
Seller Signs Contract
“Accepted Offer" is a handshake agreement
Nothing is legally binding until contract is signed by both buyer and seller, and the 10°4 deposit is submitted
Due diligence and contract signing typically only takes about 1 week, but can take longer depending on the management company, scheduling the inspector... etc.
Day 1
Fully Executed Contract Sent to Buyer’s Attorney
Schedule Appraisal
Buyer Begins Mortgage Application
Buyer Starts Purchase Application / Condo Board Package
Bank Issues Commitment Letter
Submit Purchase Application to Boord
Day 30
Board Review of Purchase Application
Each boord is different, but most hove a review period of 30 days or less, during which they can ask for additional documents, explanation...etc regarding your application.
Day 60
Board Requests Interview with Buyer
Interview
Board Approval
Lender Clear to Close
Attorneys Schedule Closing
Issue Closing Disclosure to Buyer
TRID Review Period (3 days)
Day 89
Final Walk Through
Day 90
Closing
Co-op
Typically cheaper.
Condo
Typically more expensive.
Co-op
75% of NYC’s housing. Built before 1980s.
Condo
25% of NYC’s housing. Built after 1980s.
Co-op
Most units ore owner-occupied. More controlled and stable.
Condo
Mix of owners and renters. More laid back.
Co-op
Very strict and thorough. Personal interview required.
Condo
Less rigorous—no interview. Quicker to approve.
Co-op
Indirect.
Stock certificate and lease.
Condo
Direct.
Buyer owns real property.
Co-op
Maintenance fees. Amount includes taxes.
Condo
Common charges. Taxes paid separately.
Co-op
Some tax deductions con be token for owner’s shore.
Condo
Tax abatement programs keep taxes low for about 10 years.
Co-op
Limited, if allowed at all.
Condo
Easy and unrestricted.
Co-op
New buyer must be approved. Seller must pay flip tax.
Condo
New buyer con rarely be denied.
Co-op
Rarely.
Condo
Yes.
COMPASS
136 N 10th Street
Brooklyn, New York 11249
110 5th Ave. 3rd Floor
Manhattan, NY 10011
THE BARAK BLACKBURN TEAM
