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New York Insider Tips – December 2016

The 1% NYC mansion tax is tripped at $1mm for resales. However, for property bought from a developer, it is tripped at $982,000. This is because the tax is “grossed up”, meaning the tax is calculated, added to the price, then calculated a second time.

An asset one can use every day while it increases in value is worth more to an owner than an asset that simply brings in income. As such, primary residential properties sell for more than otherwise equal pure investment properties.

Three tips for renovating small bathrooms in apartments or houses: 1) Install a wall-hung toilet, 2) Install a pedestal or wall-hung sink, and 3) Create sunken shelf storage between wall studs on two walls. All will create the feeling of more space and free up floor area.

While most NYC flip taxes are paid by seller, there are a select set of co-ops that require a purchaser pay it. This is most often the case with high-end pre-war co-ops uptown that converted before the 1980s. Many of these flips are 2-3% of purchase price.

Buying into a new condominium includes two unique closing costs for the purchaser. First, one must pay for a proportionate share to purchase super’s live-in apartment. Second, one must make payment into to the building’s “rainy day fund” called a working capital contribution – amounting to a few months’ common charges.