Buying Process

Buying a Home in Manhattan: The Buying Process

Buying a home in Manhattan is different from buying in most other parts of the country. Between co-op boards, condo applications, attorney due diligence, building financials, and New York closing costs, you’ll need to consider many details.

Candis and Brent will guide you through each step, explain your options, and help keep your purchase moving forward.

Step 1: Understand Your Budget

Before beginning your search, determine how much you are comfortable spending, not only on the purchase price, but also on monthly expenses and closing costs.

Your ongoing housing expenses may include:

• Mortgage payments
• Co-op maintenance or condo common charges
• Property taxes
• Homeowners insurance
• Assessments
• Utilities
• Parking, storage or amenity fees

If you plan to finance your purchase, your first step should be speaking with a lender experienced with New York City properties.

A lender can provide a preapproval letter showing approximately how much you may be able to borrow. Because interest rates and financial circumstances can change, you may need to update the letter during your search.

Step 2: Choose Your Buyer’s Agent

A buyer’s agent represents your interests throughout the purchase. We will help you.

• Understand current market conditions
• Identify suitable properties
• Arrange and attend showings
• Review comparable sales
• Evaluate a building’s rules and financial expectations
• Prepare and negotiate your offer
• Coordinate with your attorney, lender, and the listing agent
• Prepare your condo application or co-op board package
• Complete the final walkthrough and closing

Before touring properties, you will sign a buyer representation agreement explaining the services provided, the length of the agreement, and how your buyer’s agent will be compensated.

Real-estate commissions are not set by law and are fully negotiable. A seller may offer to pay some or all of the buyer-agent compensation. If the seller’s contribution does not cover the amount agreed upon in the buyer representation agreement, the buyer may be responsible for the difference. We will discuss this with you before you begin viewing homes.

Step 3: Decide What Type of Home Fits Your Needs

Manhattan buyers will generally consider four types of properties:

Condominium

You own the apartment as real property and receive a deed. Condos generally offer greater flexibility for financing, subletting, investing, and resale, but they are often more expensive than comparable co-ops.

Cooperative

You purchase shares in a corporation that owns the building and receive a proprietary lease for your apartment. Co-ops frequently have stricter financial requirements, subletting restrictions, and an approval process that may include a board interview.

Condop

A condop is legally structured as a co-op but may operate with rules that are more similar to a condominium. Financing, subletting, and approval requirements depend on the individual building.

Townhouse

A townhouse offers greater privacy and control, but the owner is directly responsible for the building’s structure, systems, maintenance, and repairs.

We will help you compare the costs, restrictions, and advantages of each ownership type.

Step 4: Begin Your Home Search

We will discuss your priorities, including:

• Preferred neighborhoods
• Purchase budget
• Number of bedrooms and bathrooms
• Building amenities
• Doorman or elevator requirements
• Pet policies
• Outdoor space
• Laundry preferences
• Commuting needs
• Financing requirements
• Subletting, pied-à-terre or investment plans

No apartment will satisfy every preference, so we will help you distinguish between necessities and features you may be willing to compromise on.

Step 5: Evaluate the Apartment and Building

In Manhattan, you are not only purchasing an apartment. You are also buying into a building.

Before making an offer, we will help you consider:

• The apartment’s condition
• Monthly maintenance or common charges
• Current or anticipated assessments
• Building amenities and services
• Pet and subletting policies
• Financing restrictions
• Renovation rules
• Flip taxes or transfer fees
• The building’s resale history
• Whether the property is a land-lease building
• Any concerns apparent from the listing information

Your attorney will conduct a more detailed legal and financial review after an accepted offer.

Step 6: Prepare Your Offer

An offer in Manhattan usually includes more than a purchase price. It may include:

• Offer price
• Down payment
• Type and amount of financing
• Mortgage contingency, if applicable
• Proposed closing date
• Preapproval letter
• Proof of funds
• Completed financial statement
• Any additional terms or contingencies

We will review recent comparable sales, current competition, the property’s condition and the seller’s circumstances before recommending an offer strategy.

An accepted offer is generally not binding in New York until both parties have signed the contract.

Step 7: Hire a New York Real Estate Attorney

Once an offer is accepted, you will need a New York attorney who regularly handles Manhattan residential transactions.

The buyer’s attorney will typically:

• Review and negotiate the contract
• Examine the title or co-op lien search
• Review the offering plan or proprietary lease
• Analyze the building’s financial statements
• Review board minutes and other building records
• Investigate liens, violations and pending litigation
• Explain the contract and financial obligations
• Coordinate with the lender and closing parties

Attorney due diligence is one of the most important protections available to a Manhattan buyer.

Step 8: Consider an Inspection

An inspection is not required for every Manhattan apartment, but it may be appropriate depending on the property’s age, condition, and type.

Inspections are particularly important for townhouses, small buildings and apartments with signs of leaks, electrical problems, structural concerns or major renovations.

If you choose an inspection, it is generally completed before you sign the contract.

Step 9: Sign the Contract and Pay the Deposit

After due diligence and contract negotiations are complete, the buyer usually signs first and submits the contract deposit, commonly 10% of the purchase price.

The seller then signs the contract. The transaction becomes binding once the contract is fully executed and delivered, subject to the terms and contingencies contained in the agreement.

The buyer’s attorney holds or transfers the deposit in accordance with the contract.

Step 10: Complete Your Financing

If you are financing the purchase, your lender will order an appraisal and review your personal finances and the building.

Lender approval of the buyer does not automatically mean the building will also qualify. A lender may examine:

• Building financial statements
• Owner-occupancy levels
• Commercial space
• Insurance coverage
• Pending litigation
• Reserve funds
• Delinquencies
• Sponsor or investor ownership
• Building condition

Avoid opening new credit accounts, making large unexplained transfers, or changing employment without discussing it with your lender.

Step 11: Submit the Building Application

Co-op Purchase

A co-op buyer submits a detailed board package that may include financial statements, tax returns, bank and investment statements, employment verification, and personal or professional reference letters.

If the written package is accepted, the buyer may be invited to a board interview. Final approval rests with the co-op board, subject to applicable law.

Condo Purchase

A condo buyer submits a purchase application to the managing agent. The condominium generally has a right of first refusal rather than the same approval authority as a co-op board. Once the condominium waives that right and all other requirements are satisfied, the purchase can proceed.

Condop Purchase

The process depends on the building’s governing documents. Some condops operate more like co-ops, while others provide a more flexible, condo-like approval process.

We will help organize the application, review it for completeness, and coordinate with the managing agent and listing agent.

Step 12: Prepare for Closing

Before closing, your attorney, lender, managing agent, and other parties complete the necessary paperwork and confirm that the transaction is ready.

Your attorney will provide a closing statement showing the funds required. Buyers should arrange certified or wired funds only by following verified instructions from their attorney. Always independently confirm wiring instructions to help protect against fraud.

We will also schedule a final walkthrough, generally shortly before closing, to confirm that:

• The apartment is in the expected condition
• Agreed-upon repairs have been completed
• Included fixtures and appliances remain
• The apartment has been emptied as required
• Major systems and appliances appear to be operating

Step 13: Close on Your New Home

At closing, the parties sign the final documents, transfer funds, and convey ownership.

Condo and townhouse buyers receive a deed. Co-op and condop buyers receive shares allocated to the apartment and a proprietary lease.

After closing, you will receive the keys to your new home.

How Long Does It Take to Buy in Manhattan?

Every transaction is different, but a general estimate after an accepted offer is:

• Cash condominium purchase: approximately 30 to 60 days
• Financed condominium purchase: approximately 60 to 90 days
• Co-op purchase: approximately 60 to 120 days
• New development purchase: timing varies significantly
• Townhouse purchase: timing depends on due diligence, financing, and property condition

These are estimates rather than guarantees. Attorney review, financing, appraisal issues, managing-agent processing, board schedules, and contract terms can all affect the timeline.

What Closing Costs Should a Buyer Expect?

Closing costs depend heavily on the property type, purchase price, and financing.

Common buyer expenses may include:

• Real-estate attorney
• Lender and appraisal fees
• Building application fees
• Credit and background checks
• Move-in deposits
• Title insurance and title searches for real property
• Co-op lien search and UCC filing fees
• Mortgage-recording tax for financed condos and townhouses
• Mansion tax for purchases of $1 million or more
• Prorated maintenance, common charges and property taxes
• Working-capital or reserve contributions
• Sponsor expenses in certain new-development purchases
• Buyer-agent compensation not paid by the seller

Co-op buyers generally do not pay title insurance or mortgage-recording tax because they are purchasing shares rather than real property. Financed condo and townhouse purchases typically have higher closing costs.

Your attorney and lender should provide transaction-specific estimates before you sign the contract.

Ready to Begin Your Manhattan Home Search?

Whether you are purchasing your first apartment, moving within New York City, relocating to Manhattan, or investing in a property, Candis and Brent will help you understand the process and make informed decisions from your first showing through closing.

Schedule a buyer consultation with Candis and Brent to discuss your goals, budget, and next steps.

This guide provides general information and is not legal, lending, accounting, or tax advice. Requirements and costs vary by property, building, lender, and transaction. Buyers should consult their attorney, lender, accountant, and other appropriate professionals.