1 // WHY DO YOU BUY REAL ESTATE?
There are many different reasons for buying property in New York. Perhaps you want to live here alone or to arrange a family nest for yourself and your family. Perhaps you are helping a relative with the purchase of housing. In the end, the purchase may be related to investment objectives. In all these cases, we can help you with the purchase and point out factors that you should pay special attention to. Read article 10 of the main reasons to buy an apartment in New York .
2 // DO YOU HAVE CASH TO BUY REAL ESTATE OR DO YOU NEED ADDITIONAL FINANCING?
Acquisition of real estate for cash can provide you with a strong position in negotiations with the seller. However, the acquisition of real estate creates the benefits of tax incentives, and the most qualified foreign buyers can get a loan to purchase real estate in the amount of up to 60% of the purchase price (depending on the building). Typical credit terms:
- $ 100,000 deposit in the bank.
- Down payment of 50% of the cost (or more).
- A reserve of funds for 12 months (mortgage payment, maintenance and taxes) in addition to 100,000 US dollars.
- Mortgage loan with a floating or fixed interest rate for 5-30 years.
Cooperatives and some condominium apartment owners have lists of pre-approved lenders. This is a list of financial institutions that have signed an agreement with the cooperative that can transfer your funds in the event of non-compliance with the conditions for lending. We have close relationships with several mortgage brokers that meet the needs of foreign buyers. Please contact us using the contact form if you have any questions about lending.
3 // DO YOU HAVE THE NECESSARY DOCUMENTATION?
When buying an apartment, all you really need is money. With cooperatives things are different. The board of the cooperative is likely to request documents for approval of the sale of real estate. Your broker will help you collect all the necessary documents in advance so that you do not lose time when the ideal option appears.
- A letter from the employer about the work position, salary and duration of work
- Last two payroll certificates
- Tax returns for the last two years
- Bank statements for the last two months
- Names, professions and ages of family members living with you.
- Weight, age and pictures of any pets.
- Two personal letters of recommendation Two business recommendations
- Verification of other assets: such as real estate, securities, etc.
- Photo document (driver’s license, passport, etc.)
4 // WHAT ARE THE COSTS OF BUYING A PROPERTY?
The good news: the services of a broker when buying a home are free. That’s right, you DO NOT pay a broker commission. In other words, our services to help you purchase a home or house in New York are absolutely free for you! When finding a property of interest, its purchase price includes:
- Broker’s commission
- Real Estate Transfer Tax (0.4%)
- Tax on high-value property (1% for properties worth more than 1 million)
- City real estate transfer tax (1% of the first 500 thousand, 1,425% after)
- Real Estate Appraisal Fees
- Legal audit of real estate and insurance fees
- Commission for opening a mortgage loan (1% -4%)
- Tax on registration of mortgage lending (1.75% -2.175%)
- Buyer Advocate
5 // HOW CAN I FIND A SUITABLE OPTION?
To search for properties for sale, you can visit various Internet sites. However, if you do it yourself, keep in mind that the process of finding the right buyer can be very unpleasant and time consuming. This is due to the fact that the vast majority of properties in New York are sold by brokers who are members of REBNY (New York Real Estate Board), which guarantees that new properties for sale will first be distributed to the broker community. Cooperation with us will help you not only to acquaint ALL potential buyers with your property, but it will also make your life easier, as we prepare all the necessary documents for you. With such market dynamics, it is necessary to act quickly and accurately, as well as to know the rules of participation.
6 // HOW LONG DOES IT TAKE TO COMPLETE A PURCHASE?
Finding the right property can take from several weeks to several years. It depends on your specific wishes and the time for which you want to find accommodation. Once you have found the right property, it’s time to act quickly. Make sure that you have the necessary documents and the required amount of money so that there are no problems with the purchase! Now is the time for the condominium or cooperative council to approve you as a buyer. Once this happens, you will be asked to deposit money and, if the accommodation is free, you can immediately be settled. The whole process usually takes at least a month, but it can take a long time.
7 // WHAT IS THE DIFFERENCE BETWEEN A COOPERATIVE AND A CONDOMINIUM?
In the condominium the owner owns a separate apartment. In addition, the buyer has an indivisible property right in such common elements as walls, roof, pool and other recreation areas. In shared housing construction (cooperative), the owner has shares in the cooperative that owns and manages the building. Cooperatives usually require the provision of information that the buyer’s sources of income and assets originate from the United States (at least most of the assets) and therefore a very conservative approach is taken. If for any reason a corporation sues the owner, it is very difficult to succeed in a lawsuit. Accordingly, foreign buyers do not have the opportunity to purchase apartments in condominiums, condominium rules, and townhouses.
8 // WHERE SHOULD I BUY A PROPERTY?
This is a very important question. If you have been in New York before and you have a personal impression of the city, be aware that the reality of permanent residence may differ from your ideas. Many other factors come into play. Where is your job or university? Where will your children go to school? How large is the apartment you are looking for? In which area can you feel at home? Would you like to rent an apartment in the future? And, of course, how big is your budget? We will be happy to hear your story and help you decide on priorities.
9 // IF I DECIDE TO BUY AN APARTMENT, WHAT WILL MY MONTHLY EXPENSES BE?
For condominiums, total expenses range from $ 0.70 to $ 1.25 per square foot per month. These costs include heating, electricity and cleaning of the area, water supply, basic cable, security, building insurance, and the operation of individual amenities (fitness center, concierge, lounge, pool, game room, etc.). In addition to total expenses, you will have to pay property tax, which is approximately 0.1% of the appraised value of the apartment – the cost determined by the city’s management.
Cooperatives charge utility bills, which include general fees and taxes (which are not paid by the owner separately) and interest on the mortgage loan, if any. Owning companies may demand very high mortgage interest (for roof repairs or for any other reason), and interest will be transferred to the shareholders of the cooperative. In this regard, it is often possible to meet a situation where the costs of servicing a cooperative can be higher (even after taking into account tax benefits included in utility payments), since condominiums are not legally allowed to purchase on credit.