How To Buy A NYC Apartment

How To Buy A NYC Apartment

  • Dana Sapir
  • 01/26/23

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Are you considering buying in Manhattan but don’t know where to start? Here is everything you need to know about buying in the Big Apple.

What Types of Apartments Does NYC Have?

First, there are 2 types of buildings in the city- co-ops and condos. Approximately 75% of the buildings are co-ops and 25% are condos. When you buy in a co-op you buy shares in a cooperative and become a shareholder. When you buy in a condo, you buy real property and become the actual owner of the unit and own a share of the common spaces. 

So— what’s the right building type for you? If you see yourself living in the apartment for 5-6 years and are really just looking for a place to call a home, then a co-op could very much be the right place for you. However, if you are an investor who’s looking to rent out the apartment, or want the flexibility to own, rent, and not be subjected to a board approval then a condo will be a better option for you.

Co-Op or Condo? Pros and Cons

The benefit of owning a co-op is first and foremost the typically lower price. Co-ops are meant for primary residency, there’s a much higher inventory so more options to choose from and the monthly maintenance which includes both building maintenance and taxes is lower- usually the average is 2$ per sqft. The downside is that you’re buying shares in a cooperative, so you do not own real property which means you are subject to board review and approval when you purchase the apartment, rent it out, renovate, and more. There are also financial requirements, the general rule of thumb is 25% debt to income ratio, and 24 months of monthly payments in liquid assets. So, for those who have the funds but can’t show enough liquid assets or income, co-op might not work. 

The benefit of owning a condo is that you own real property and have the flexibility to rent it out, have friends or family members stay for long periods of time, and there are no requirements when you buy like you have when you buy a co-op apartment. The downside is that the price of a condo is higher than a co-op, and the monthlies are higher as well: on average $3 per sqft. There’s also not much inventory as we see for co-ops; in some areas there are only a handful of condo buildings, like around Central Park on the East and West side. 

The Purchasing Process

The first step when you decide to buy a home, if you’re financing, is to speak with a lender to understand your purchase power and obtain a pre-approval letter. You don’t want to waste time looking at homes you can’t afford or losing on a great deal since you didn’t take care of this in the beginning. Sit down for a consultation with your agent to focus your search on the neighborhoods that most fits your lifestyle, discuss your dream apartment- the needs and wants, your timeline, budget and so on. Set a plan together and only then start looking. Discussing thoroughly with your agent and setting a plan will save you a lot of footwork and sweat later on in the process.

In both co-op and condo buildings you will first reach an accepted offer with the sellers, then sign a contract with 10% deposit and then will need to submit a sales package. In a condo, this sales package tends to be a shorter one and usually doesn’t require a super deep and detailed analysis of your financials like we have in co-op buildings. Once we submit the package, the management in both types of buildings will review it and will pass it to the board for review. In a condo, the board will sign the right of first refusal typically after 2-3 weeks, allowing for the sale to proceed. In a co-op, the board will review the package in detail, and if the package meets the criteria, they will invite the buyers to an interview. This is usually the final step before approving the sale and can take anywhere between 4-8 weeks. After that the attorney, the co-op and the bank if there’s one involved, will schedule the closing.

Closing and Closing Costs

In general, any property above $1M will have 1% mansion tax. That percentage goes up incrementally with higher purchase prices. Next is the Attorney; one who specializes in Manhattan condos and co-ops, which is the type of attorney you would want to have, usually charges between $2500-3500. Next are the building fees- all buildings take some fees ranging from $500 to $3000 that go towards the processing fee, moving fee, and more. Then, whether you’re financing or not, you will want to make sure the apartment is “clean” from any liens or judgments, so in a condo there’s a title search and title insurance which is 0.004% of the purchase price, and in a co-op since there’s no title, there’s a lien search which only costs a couple of hundred dollars. There are also financing expenses: in a co-op since there’s no real property, the cost is a couple of thousands that go toward the loan application, bank attorney, appraisal, recognition agreement and UCC1 filing. In a condo, add to those the mortgage recording tax and mortgage title insurance. All in all, buyers of a condo can expect to pay between 2-4% of the purchase price, and buyers of a co-op 1.5-2%, with the higher side being if there’s financing. 


Buying a home in any market- seller’s market, buyer’s market, or a neutral market, requires some planning in advance. For most people, it’s the largest investment they’ll make. Make sure you have the right professionals on your side- a broker, lender, attorney, and maybe even more, to educate, advise, and guide you to success.