On a $1 million NYC apartment sale, transfer taxes alone total $18,250 for the seller, combining both the city and state levies. As a Licensed Real Estate Associate Broker with Keller Williams NYC, I have walked hundreds of clients through these numbers over 25+ years of closings. Transfer tax is one of the most commonly misunderstood costs in New York City real estate, and getting it wrong can throw off your entire budget by tens of thousands of dollars.
This guide covers both the NYC transfer tax and the New York State transfer tax, who typically pays each one, the rate brackets at different price points, and the exemptions that may apply. If you are buying or selling in Manhattan, Brooklyn, or Queens, these numbers will factor into your closing costs. For a broader look at all closing expenses, see my complete NYC closing costs breakdown.
What Is the NYC Transfer Tax?
The transfer tax in NYC is a tax imposed on the transfer of real property. It is technically called the Real Property Transfer Tax (RPTT) at the city level and the Real Estate Transfer Tax at the state level. Both are calculated as a percentage of the sale price, and both apply every time a property changes hands. Unlike property taxes, which recur annually, the transfer tax is a one-time cost paid at closing.
In New York City, you are subject to two separate transfer taxes: one from the city (NYC RPTT) and one from New York State. The rates differ based on the sale price and whether the property is residential or commercial.
NYC Transfer Tax Rates (RPTT)
| Property Type | Sale Price | NYC RPTT Rate |
|---|---|---|
| Residential | $500,000 or less | 1.0% |
| Residential | Over $500,000 | 1.425% |
| Commercial | $500,000 or less | 1.425% |
| Commercial | Over $500,000 | 2.625% |
New York State Transfer Tax Rate
New York State imposes an additional transfer tax of 0.4% on all real estate transactions. For residential properties sold for $3 million or more (or commercial properties at $2 million or more), an additional 0.65% surcharge applies at the state level, bringing the state rate to 1.05% on those high-value sales.
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Who Pays the Transfer Tax in NYC?
By custom and by law, the seller pays the NYC transfer tax and the NYS transfer tax. This is a firm convention in New York City real estate. Buyers do not pay transfer tax unless the contract specifically shifts that obligation, which is rare for resale apartments. The one major exception: in new development purchases, sponsors (developers) routinely require the buyer to pay the seller's transfer tax as part of the deal. I always flag this for my buyers during contract review, because on a $1.5 million new condo, that adds $21,375 in NYC RPTT alone to the buyer's closing costs.
New Development Buyer Alert
When buying from a sponsor or developer, carefully review the purchase agreement. Sponsors frequently shift the NYC transfer tax, the NYS transfer tax, and even their attorney's fees to the buyer. On a $2M condo, these shifted costs can add $40,000+ to what you owe at closing. Always have your real estate attorney review these provisions before signing.
Transfer Tax Calculations at Common Price Points
Here is what the total transfer tax looks like at three common NYC sale prices. These figures represent what the seller owes at a standard resale closing.
| Sale Price | NYC RPTT | NYS Transfer Tax | Total Transfer Tax | % of Sale |
|---|---|---|---|---|
| $500,000 | $5,000 | $2,000 | $7,000 | 1.40% |
| $1,000,000 | $14,250 | $4,000 | $18,250 | 1.825% |
| $2,000,000 | $28,500 | $8,000 | $36,500 | 1.825% |
Transfer Tax vs. Mansion Tax: What Is the Difference?
The transfer tax and the NYC mansion tax are two separate obligations. The transfer tax applies to every sale regardless of price. The mansion tax is an additional buyer-paid tax that kicks in on residential purchases of $1 million or more, with graduated rates climbing to 3.9% on sales above $25 million. They stack on top of each other, so a $2M buyer pays both the mansion tax (1.25%, or $25,000) and potentially the transfer tax if the contract shifts it.
Transfer Tax Exemptions
Certain transfers are exempt from the NYC RPTT. These include transfers to or from government agencies, transfers related to tax liens, certain cooperative housing corporation transfers, and transfers where the consideration is $25,000 or less. Transfers between spouses as part of a divorce settlement are also typically exempt. However, transfers between family members outside of divorce (such as gifting a property to a child) are generally not exempt if consideration exceeds $25,000. After any deed transfer is recorded, the transaction becomes publicly searchable through ACRIS, NYC's free property records system.
Co-op Transfer Tax Nuance
When you sell a co-op apartment, the transfer tax applies to the full sale price, which includes your share of the building's underlying mortgage. For example, if you sell a co-op for $600,000 and the apartment's proportionate share of the building's mortgage is $100,000, the transfer tax is calculated on the full $600,000 sale price. This sometimes catches sellers off guard because the net proceeds they receive are lower than $600,000, but the tax is based on gross price.
How to Budget for Transfer Tax
If you are selling, plan for approximately 1.4% to 1.825% of your sale price going to transfer taxes (city plus state combined). If you are buying a new development condo, add that same percentage to your closing costs because the sponsor will almost certainly shift it to you. For a complete picture of every cost you will encounter, my NYC closing costs guide walks through each line item in detail. For sellers who want a timeline of the full closing sequence, see the NYC seller closing process guide.
I run these calculations for every client before we list or make an offer. Understanding transfer tax NYC obligations upfront means no surprises at the closing table. If you are planning a sale or purchase and want exact numbers for your specific property, reach out for a consultation and I will prepare a full net sheet showing every tax and fee.
