Property tax, mansion tax, transfer tax, flip tax, and more: the complete guide to NYC real estate taxation
On a $1.5 million Manhattan condo purchase, the combined tax burden for the buyer totals approximately $38,100 in mansion tax and mortgage recording tax alone, before property taxes even begin. As a Licensed Real Estate Associate Broker with Keller Williams NYC, I have spent 25+ years watching clients get blindsided by NYC real estate taxes they did not anticipate. This guide covers every tax that applies to buying, owning, and selling property in New York City.
Between city, state, and building-level charges, the total cost of transacting in Manhattan, Brooklyn, Queens, the Bronx, and Staten Island can range from 3% to 8% of the sale price.
| Tax | Who Pays | When | Rate / Range |
|---|---|---|---|
| NYC Transfer Tax (RPTT) | Seller | At closing | 1.0% - 2.625% |
| NYS Transfer Tax | Seller | At closing | 0.4% - 0.65% |
| Mansion Tax | Buyer | At closing | 1.0% - 3.9% |
| Flip Tax | Seller (usually) | At closing | 1% - 3% (varies by building) |
| Property Tax | Owner | Annually (quarterly) | Varies by class |
| Pied-à-Terre Tax (new 2026) | Non-resident owner | Annually | 0.8% - 6.5% |
| Mortgage Recording Tax | Buyer | At closing (condos/houses) | 1.8% - 1.925% |
| Capital Gains Tax (federal, NYS, NYC) | Seller | On the profit, at tax filing | 0% - 20% federal, plus state and city income tax |
The NYC Real Property Transfer Tax (RPTT) and the NYS Real Estate Transfer Tax are the seller's primary tax obligations at closing. Combined, they run 1.4% on residential sales of $500,000 or less, 1.825% above $500,000, and 2.075% at $3 million and above. For a full breakdown of rates, brackets, exemptions, and real dollar calculations at common price points, see my dedicated NYC transfer tax guide.
On a $1 million sale the seller owes about $18,250 in combined transfer taxes, and $36,500 on a $2 million sale. These come out of the seller's proceeds, though in new development the sponsor often shifts the cost to the buyer.
The NYC mansion tax is a buyer-paid tax on residential purchases of $1 million or more. Despite its name, it applies to apartments as well as houses. The rates are graduated:
| Purchase Price | Mansion Tax Rate | Tax on Sale at Threshold |
|---|---|---|
| $1,000,000 - $1,999,999 | 1.00% | $10,000 |
| $2,000,000 - $2,999,999 | 1.25% | $25,000 |
| $3,000,000 - $4,999,999 | 1.50% | $45,000 |
| $5,000,000 - $9,999,999 | 2.25% | $112,500 |
| $10,000,000 - $14,999,999 | 3.25% | $325,000 |
| $15,000,000 - $19,999,999 | 3.50% | $525,000 |
| $20,000,000 - $24,999,999 | 3.75% | $750,000 |
| $25,000,000+ | 3.90% | $975,000+ |
The mansion tax applies to the entire purchase price, not just the amount above $1 million. This creates a significant "cliff" effect: a $999,999 purchase pays $0 in mansion tax, while a $1,000,000 purchase pays $10,000. I run these numbers for buyers at the offer stage so the mansion tax is inside their maximum budget.
Currently available properties across NYC
259 Berry Street
Williamsburg
150 Central Park S #2204
Central Park South
Listing information provided courtesy of the Real Estate Board of New York's Residential Listing Service (RLS). Information is deemed reliable but not guaranteed. Sale listings verified. ©2026 REBNY. RLS data displayed by Keller Williams NYC.
The flip tax is not technically a government tax. It is a transfer fee charged by co-op buildings when a shareholder sells their apartment. Flip tax rates and structures vary by building: some charge a flat percentage of the sale price (typically 1% to 3%), others charge a percentage of profit, and some use a sliding scale based on how long the seller has owned the unit. Condos generally do not charge flip taxes.
NYC property taxes are assessed by the Department of Finance based on the property's assessed value, which is often significantly below market value due to NYC's complex assessment cap system. Residential properties fall into Class 1 (1-3 family homes) or Class 2 (co-ops, condos, rental buildings). The effective property tax rate varies dramatically: a Class 1 home might pay an effective rate of 0.8% to 1.2% of market value, while a Class 2 condo could pay 0.5% to 1.0%.
Co-op owners do not receive an individual property tax bill. Instead, the building pays property tax collectively, and each shareholder's share is included in their monthly maintenance. This is why co-op maintenance fees are higher than condo common charges: the maintenance includes your proportionate share of the building's property tax bill.
Many new and recently converted condos benefit from 421-a or similar tax abatements that reduce property taxes by 40% to 100% in the early years. These abatements phase out over 10 to 25 years. Always check the abatement schedule before buying: a condo with $800/month in taxes today could jump to $2,500/month when the abatement expires.
When you finance a condo or house purchase (not co-ops, since co-op loans are technically personal property loans), NYC imposes a mortgage recording tax. The rate is 1.8% on mortgages under $500,000 and 1.925% on mortgages of $500,000 or more. On a $1 million mortgage, that is $19,250 due at closing. This tax does not apply to co-op purchases, which is one of the financial advantages of buying a co-op over a condo.
Capital gains tax applies to the profit on a sale, not the sale price. A NYC seller can owe three layers: federal capital gains tax (0%, 15% or 20% depending on income), New York State income tax (4% to 10.9%), and NYC personal income tax (3.078% to 3.876%). Primary residences get relief under IRC Section 121: a single seller can exclude up to $250,000 of gain and married couples filing jointly up to $500,000, if they owned and lived in the home for at least two of the last five years. New York State and the city follow the federal exclusion. Investment property does not qualify, but a 1031 exchange can defer the federal tax. Document renovations, since capital improvements raise your cost basis. The full walkthrough is in my NYC capital gains tax guide for home sellers.
New York enacted an annual city surcharge on property that is not a primary residence on May 27, 2026, applying to city fiscal years that start July 1, 2026. The first charges land on the property tax bill due January 1, 2027, and the law sunsets June 30, 2031 unless Albany renews it. In Phase 1 (through June 30, 2028) the threshold is the Department of Finance valuation on the tax bill, not the sale price: above $1,000,000 for condos and co-op units, above $5,000,000 for one-to-three-family houses. The rate applies to the entire valuation, so a condo carried at $1,000,000 owes about $40,000 a year (4.0%). Rates for apartments rise to 5.25% from $3 million and 6.5% from $5 million of valuation. Primary residences are not subject to it. My pied-a-terre buying guide has the full rules.
Closing-day taxes for a buyer and seller at three common prices, assuming a standard resale condo with 80% financing:
| Tax | $750K Sale | $1.5M Sale | $3M Sale |
|---|---|---|---|
| Seller: Transfer Tax (City + State) | $13,688 | $27,375 | $54,750 |
| Buyer: Mansion Tax | $0 | $15,000 | $45,000 |
| Buyer: Mortgage Recording Tax | $10,800 | $23,100 | $46,200 |
| Total Buyer Taxes | $10,800 | $38,100 | $91,200 |
| Total Seller Taxes | $13,688 | $27,375 | $54,750 |
Most of these rates are fixed by law, but some exposure is controllable. Buying a co-op instead of a condo eliminates the mortgage recording tax. Purchasing just below the $1 million mansion tax threshold (with the seller's agreement on price) saves the buyer 1% of the purchase price. Choosing buildings with active tax abatements reduces your annual property tax for years. And timing your sale to qualify for the primary residence capital gains exclusion ($250,000 single / $500,000 married) can save tens of thousands in federal income tax.
For all closing costs beyond taxes, see my NYC closing costs guide.
If you want exact numbers for your specific scenario, reach out for a consultation and I will prepare a net sheet showing every tax and fee you can expect.
Currently available properties across NYC
16 Desbrosses Street #2S/3S
Tribeca
380 RECTOR Place #8N
Battery Park City
Listing information provided courtesy of the Real Estate Board of New York's Residential Listing Service (RLS). Information is deemed reliable but not guaranteed. Sale listings verified. ©2026 REBNY. RLS data displayed by Keller Williams NYC.
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Disclaimer: All information provided in this article is for educational purposes only and does not constitute legal, financial, or real estate advice.
Listing data sourced from the REBNY Residential Listing Service (RLS). Information is deemed reliable but not guaranteed.
Milton Coste is a Licensed Real Estate Associate Broker affiliated with Keller Williams NYC,
360 Madison Avenue, 9th Floor, New York, NY 10017. License No. 10301213304.
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Milton Coste
Licensed Real Estate Associate Broker · Keller Williams NYC
License No. 10301213304 · 360 Madison Avenue, 9th Floor, New York, NY 10017
