Man reviewing financial documents at a desk for a New York City real estate transaction. — Residential property sales in New York City can generate separate city and state transfer taxes. The property type, sale price, contractual allocation, and consideration used for tax purposes determine the amount due.

A sale of residential property in New York City can generate two separate transfer taxes: the New York City Real Property Transfer Tax and the New York State Real Estate Transfer Tax.

Both taxes are generally calculated from the consideration paid for the property, rather than the amount financed. They apply to co-ops as well as condos, townhouses, and one- to three-family homes, even though a co-op transfer involves shares and a proprietary lease rather than a deed to an individual apartment.

In a typical resale transaction, these transfer taxes are paid by the seller. However, a contract can assign some or all of the seller’s transfer-tax obligation to the buyer. This is commonly encountered in sponsor and new-development sales, making the taxes relevant to buyer closing-cost calculations as well as seller net proceeds.

The New York State mansion tax is a separate buyer-side tax and is not included in the calculations below.

1. The New York City Real Property Transfer Tax

The New York City (NYC) Real Property Transfer Tax, commonly abbreviated as RPTT, applies to most property transfers valued at more than $25,000. For an individual residential co-op, condominium, or one- to three-family home, the applicable rates are:

Residential sale price: $500,000 or less | NYC RPTT rate: 1.00%
Residential sale price more than: $500,000 | NYC RPTT rate: 1.425%

Once the consideration exceeds $500,000, the 1.425% rate applies to the entire amount—not merely the portion above $500,000.

NOTE: The city uses higher rates for many other types of real estate, including certain commercial properties and buildings containing more than three residential units. Those transfers fall outside the individual residential rates used in this article.

2. The New York State Real Estate Transfer Tax

New York State (NYS) imposes a separate real estate transfer tax on transfers where the consideration exceeds $500.

Standard NYS Transfer-Tax Rate

The standard state rate is: $2 for every $500 of consideration
Expressed as a percentage, this equals: $2 / $500 = 0.40%

For most residential transactions below $3 million, the New York State transfer tax is therefore 0.40% of the consideration.

Additional NYS Transfer Tax for NYC Residential Sales

For a conveyance of residential real property in New York City with consideration of $3 million or more, an additional 0.25% state transfer tax applies. This produces a combined New York State transfer-tax rate of 0.65% for that transaction.

Residential sale price: Less than $3 million | NYS transfer-tax rate: 0.40%
Residential sale price: $3 million or more | NYS transfer-tax rate: 0.65%

The additional 0.25% is part of the seller-side New York State transfer-tax structure. It is distinct from the graduated mansion tax paid by buyers of qualifying residential property priced at $1 million or more.

3. Combined NYC and NYS Transfer-Tax Rates

For many individual residential sales, the city and state transfer-tax rates can be viewed together. The combined rate depends on the sale price and the thresholds applicable to each tax:

Residential sale price	NYC RPTT	NYS transfer tax	Combined rate
$500,000 or less	1.00%	0.40%	1.40%
More than $500,000 but less than $3 million	1.425%	0.40%	1.825%
$3 million or more	1.425%	0.65%	2.075%

Example 1: A $450,000 Co-op Sale

Consider the resale of an individual co-op apartment for $450,000. Because the price is no more than $500,000, the NYC RPTT rate is 1%.

NYC RPTT: $450,000 x %1.00 = $4,500
NYS transfer tax: $450,000 x %0.40 = $1,800
Combined transfer taxes: $4,500 + $1,800 = $6,300

The combined city and state transfer taxes would be $6,300, equivalent to 1.40% of the sale price. In a conventional resale, this would ordinarily be a seller closing cost.

Example 2: A $1.2 Million Condo Sale

Now consider an individual condominium selling for $1.2 million. Because the price exceeds $500,000, the NYC RPTT rate increases to 1.425%. The transaction remains below the $3 million threshold for the additional state transfer tax, so the state rate remains 0.40%.

NYC RPTT: $1,200,000 x 1.425% = $17,100
NYS transfer tax: $1,200,000 x 0.40% = $4,800
Combined transfer taxes: $17,100 + $4,800 = $21,900

The combined city and state transfer taxes would be $21,900, equivalent to 1.825% of the sale price. The buyer would separately owe a New York State mansion tax because the purchase price is at least $1 million. That buyer-side tax is not included in the $21,900 calculation.

Example 3: A $3.5 Million Townhouse Sale

Consider a townhouse selling for $3.5 million. The NYC RPTT rate is 1.425%. Because the property is residential real property in New York City and the consideration is at least $3 million, the combined New York State transfer-tax rate is 0.65%.

NYC RPTT: $3,500,000 x 1.425% = $49,875
Standard NYS transfer tax: $3,500,000 x 0.40% = $14,000
Additional NYS transfer tax: $3,500,000 x 0.25% = $8,750
Combined NYS transfer taxes: $14,000 + $8,750 = $22,750
Combined NYC and NYS transfer taxes: $49,875 + $22,750 = $72,625

The combined seller-side transfer taxes would be $72,625, equivalent to 2.075% of the sale price. The buyer’s graduated mansion tax would again be calculated separately.

4. Who Pays the Transfer Taxes?

New York State generally places the transfer-tax obligation on the grantor, or seller. The seller is also ordinarily responsible for the NYC RPTT. If the seller fails to pay, however, liability can extend to the buyer.

The purchase contract can also change the economic allocation between the parties. In a sponsor or new-development sale, the offering terms may require the buyer to pay transfer taxes that would ordinarily be seller expenses.

When a buyer assumes a seller obligation, the final transfer-tax calculation can become more complicated. For NYC RPTT purposes, taxes or other seller obligations paid by the buyer can affect the consideration used to calculate the tax. This can result in what is sometimes described as “grossing up” the transfer tax.

New York State provides different treatment for certain buyer-paid transfer taxes in residential transactions. Its Form TP-584 instructions state that when the buyer pays the state transfer tax under a contract with the seller, that tax is excluded from the state’s calculation of taxable consideration.

Because the city and state calculations do not necessarily treat every buyer-paid obligation identically, the transaction’s attorney calculates the final transfer-tax amount based on the contract terms rather than relying solely on a simple percentage estimate.

5. Purchase Price Is Not Always the Entire Consideration

In a straightforward arm’s-length sale, the contract price is generally the starting point for calculating transfer taxes. In more complicated transfers, taxable consideration can include other economic value received by the seller. Depending on the transaction, consideration may include:

Cash paid for the property
Debt assumed by the buyer
Certain liens or encumbrances remaining on the property
Seller obligations paid by the buyer
Other property or economic value exchanged

This distinction becomes particularly important in transfers involving entities, partial ownership interests, existing debt, related parties, or contractual payment of the seller’s expenses.

6. How Transfer Taxes Differ From Other NYC Closing Costs

NYC and NYS real estate transfer taxes are only one category of taxes and adjustments that can arise in a New York City real estate transaction. Other charges may apply depending on the purchase price, financing, property type, and the buyer’s or seller’s circumstances. Although these costs can appear together in a closing-cost estimate or closing statement, they are calculated separately and serve different purposes:

Mansion tax: Generally paid by the buyer when qualifying residential consideration is $1 million or more.
Mortgage recording tax: Associated with recording a mortgage against real property and generally tied to the mortgage amount.
Capital gains tax: An income-tax consideration based on the seller’s taxable gain, not simply the sale price.
Property tax adjustments: Prorations between buyer and seller for property taxes covering periods before and after closing.

A single transaction may involve several of these costs, but each arises from a different tax mechanism and uses a different calculation.

The Role of a Real Estate Agent

A seller’s agent can incorporate estimated NYC and NYS transfer taxes into a preliminary net-proceeds analysis. A buyer’s agent can identify when a listing or offering plan requires the purchaser to assume transfer taxes and include that expense in the buyer’s anticipated closing costs. The transaction’s attorneys determine how the contract assigns the tax obligations and prepare or review the required transfer documents. The final taxable consideration and amounts due are established through the legal closing and filing process.

Related Resources & Insights

If you’re considering buying or selling a co-op, condo, townhouse, or one- to three-family home in New York City, feel free to reach out to discuss anticipated closing costs and how transfer taxes may affect the transaction.

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Understanding NYC and NYS Real Estate Transfer Taxes