A buyer is purchasing a $1,200,000 townhouse in New York City. Which of the following correctly identifies the transfer-related closing costs and the party customarily responsible for each?
Correct Answer
A) NY state transfer tax ($4,800) and NYC transfer tax ($17,100) paid by the seller; mansion tax ($12,000) paid by the buyer
In New York City, the NY state transfer tax ($4/thousand = $4,800 on $1.2M) and NYC transfer tax (1.425% on residential sales over $500K = $17,100) are customarily paid by the seller. The mansion tax (1% on purchases of $1M or more = $12,000) is always paid by the buyer. A buyer's agent must understand this allocation to accurately prepare clients for closing costs.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
The fiduciary obligation to protect a client's private information and not disclose it to third parties without permission, surviving even after the agency relationship ends.
In real estate, a client is someone to whom the agent owes fiduciary duties through an agency relationship, while a customer is a third party to whom the agent owes only honesty and fair dealing.
More Agency Relationships Disclosures Questions
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Under New York's Property Condition Disclosure Act, how is the $500 credit amount determined when a seller elects not to provide the Property Condition Disclosure Statement?
Acting as a dual agent in New York, an agent has presented a below-asking-price offer that the seller rejected. The seller then asks the agent what the buyer's maximum budget is. How should the dual agent respond?
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- → Michael is a buyer's agent in New York. His client makes an offer on a property listed by another agent in his same brokerage. The listing agent becomes unavailable, and Michael's broker asks him to also represent the seller to complete the transaction. What must happen for Michael to legally represent both parties?
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Previous Question
Sarah is a buyer's agent in New York representing client Tom who is purchasing a single-family home. The seller has chosen not to provide a Property Condition Disclosure Statement and instead will provide the statutory $500 credit to the buyer at closing. What should Sarah advise Tom about this situation?
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Karen is a buyer's agent representing client Paul who wants to purchase a rent-stabilized apartment building in Brooklyn as an investment property. Paul asks Karen about the rental income potential. What should Karen advise Paul regarding rent-stabilized units in New York?