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Closing Costs for Sellers in New York: Complete 2026 Guide

Selling a home in New York can provide a substantial financial return, but the amount you receive at closing is not the same as the property’s sale price. Before the transaction is completed, sellers may need to pay several expenses, including transfer taxes, real estate commissions, attorney fees, mortgage-related charges, title or lien expenses, property-tax adjustments, and other closing costs. For homeowners in New York City, Long Island, Westchester, and other parts of New York State, the exact costs can vary considerably depending on the property’s location, sale price, mortgage balance, type of property, and terms negotiated with the buyer. Understanding these expenses before listing your home can help you set a realistic asking price, compare offers accurately, and avoid an unpleasant surprise when you receive your final settlement statement. This 2026 guide explains the major closing costs for sellers in New York, how much each expense may be, which costs are normally paid by the seller, how NYC costs differ from the rest of New York State, and how selling directly to a cash buyer may change the cost structure. What Are Closing Costs for Sellers? Seller closing costs are the expenses associated with transferring ownership of a property from the seller to the buyer. These costs are generally deducted from the seller’s proceeds at closing rather than paid entirely out of pocket beforehand. For example, imagine you sell a New York home for $700,000. The $700,000 is the gross sale price—not necessarily the amount you take home. Your final proceeds could be reduced by: New York State transfer tax NYC transfer tax, if applicable Real estate agent commissions Attorney fees Mortgage payoff Outstanding property taxes Liens or judgments Recording or administrative charges Seller concessions Repair credits negotiated with the buyer Other transaction-specific expenses The result is your net sale proceeds. Gross Sale Price vs. Net Proceeds This distinction is extremely important when selling a house. Gross sale price is the amount the buyer agrees to pay. Net proceeds are what remains after your mortgage, taxes, commissions, closing expenses, liens, and other deductions have been paid. A seller who receives a $600,000 offer, for example, should not automatically compare it with another buyer’s $590,000 offer without looking at the complete terms. If the $600,000 offer requires substantial repairs, seller concessions, high commissions, or other expenses while the $590,000 offer is simpler and has fewer deductions, the lower offer could potentially produce more money at closing. This is why sellers should evaluate the net proceeds, not just the headline offer price. How Much Are Closing Costs for Sellers in New York? There is no single percentage that applies to every New York home sale. Your total seller closing costs depend on factors such as: Sale price Property location Whether the property is in NYC Whether you use a real estate agent Mortgage balance Property type Outstanding liens Attorney fees Negotiated buyer concessions Taxes and other adjustments Whether the property is sold traditionally or directly to a buyer One of the largest government-related expenses is the New York State real estate transfer tax. 1. New York State Real Estate Transfer Tax New York State imposes a real estate transfer tax on qualifying transfers of real property when the consideration exceeds $500. The standard state transfer tax is generally calculated at $2 for every $500 of consideration, equivalent to 0.4%. For example: Sale Price Approx. NYS Transfer Tax $300,000 $1,200 $400,000 $1,600 $500,000 $2,000 $600,000 $2,400 $750,000 $3,000 $1,000,000 $4,000 $1,500,000 $6,000 These are simplified examples of the base state transfer tax and do not represent every possible exemption, special rule, or transaction structure. The seller generally bears the New York State transfer tax, although the contract can address who pays particular expenses. What Is the New York Mansion Tax? A separate additional 1% tax generally applies to qualifying residential transfers of $1 million or more. This is commonly referred to as the New York mansion tax. Importantly, the mansion tax is generally imposed on the buyer, rather than being an ordinary seller closing cost. Sellers should nevertheless understand it because it can affect the economics of higher-value transactions and may become part of negotiations. If you are selling a property for $1 million or more, have your attorney calculate the exact taxes applicable to your transaction. 2. New York City Real Property Transfer Tax If the property is located in New York City, sellers may have an additional major expense: the New York City Real Property Transfer Tax (RPTT). The NYC RPTT is separate from the New York State transfer tax. NYC states that the RPTT generally applies to qualifying sales or transfers of real property valued above $25,000. For qualifying residential Type 1 and Type 2 transfers: $500,000 or less: 1% More than $500,000: 1.425% Different rates apply to other types of property and transfers. This means NYC sellers should not use the New York State transfer tax alone when estimating their closing expenses. Example: Selling a NYC Home for $800,000 Suppose you sell a qualifying NYC residential property for $800,000. A simplified calculation could include: New York State transfer tax: $800,000 × 0.4% = $3,200 NYC RPTT: $800,000 × 1.425% = $11,400 That creates approximately $14,600 in combined state and city transfer taxes, before considering commissions, attorney fees, mortgage payoff, adjustments, or other costs. The actual tax calculation should be confirmed for your specific transaction because exemptions, property classifications, consideration rules, and transaction structures can affect the amount due. NYC also requires RPTT filings through its ACRIS system, and the city provides an online system for preparing transfer-tax filings and recording documents. 3. Real Estate Agent Commission For sellers who list through a traditional real estate agent, commission can be one of the largest transaction expenses. Unlike a government transfer tax, an agent’s compensation is not a single mandatory statewide percentage. The amount and structure should be established in your listing agreement and negotiated based on the services provided. Your potential real estate expenses may include: Listing-side compensation

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High-ROI Real Estate Investment Opportunities in New York City

Real Estate Investment Opportunities in New York City: A Complete 2026 Guide

Leave a Comment / New York / Jeff

New York City remains one of the most important real estate markets in the United States, offering investors opportunities across residential, multifamily, rental, luxury, commercial, and value-add properties. However, NYC real estate is not a one-size-fits-all market. Prices, rental demand, taxes, regulations, financing costs, and investment potential can vary dramatically between boroughs and even between neighboring areas. For investors in 2026, the key question is not simply “Is New York City real estate a good investment?” The better question is: “Which type of NYC property fits my investment strategy, budget, risk tolerance, and expected return?” Investors can consider strategies ranging from buying and holding rental properties to renovating distressed homes, purchasing multifamily buildings, investing in emerging neighborhoods, or acquiring properties for long-term appreciation. At the same time, today’s market requires careful financial analysis. High acquisition costs, property taxes, insurance, maintenance, financing expenses, and changing regulations can significantly affect an investment’s profitability. This guide explores the major real estate investment opportunities in New York City in 2026, explains how investors can evaluate properties, and highlights the factors that can make one NYC investment significantly better than another. Why Invest in New York City Real Estate? New York City has several characteristics that continue to attract real estate investors. The city has a massive population, diverse employment base, international business presence, major universities, tourism, cultural institutions, transportation infrastructure, and neighborhoods with very different housing markets. This diversity creates multiple potential investment strategies. An investor may focus on: Long-term rental properties Multifamily buildings Single-family homes Condos and co-ops Fix-and-flip properties Distressed real estate Value-add properties Luxury properties Development opportunities Commercial or mixed-use properties Properties in emerging neighborhoods The right strategy depends on the investor’s capital, experience, financing, desired holding period, and tolerance for risk. New York’s rental market is particularly important for investors because strong housing demand can support rental income. Manhattan, for example, has experienced exceptionally high rental prices in 2026, while limited apartment availability has increased competition among renters. However, strong rents do not automatically make every property a good investment. An expensive property can still produce weak returns if the purchase price, taxes, financing, insurance, and maintenance costs consume too much of the rental income. Best Real Estate Investment Opportunities in NYC in 2026 There is no single “best” NYC investment property. Different property types serve different investment objectives. 1. Multifamily Investment Properties Multifamily properties remain one of the most attractive categories for investors who want multiple income streams from a single asset. A multifamily property may contain two, three, four, or more residential units, depending on the building and its legal classification. The major advantage is diversification of rental income. If one unit becomes vacant, the property may still generate income from the remaining units. This can make multifamily properties particularly appealing compared with a single rental unit. Investors should evaluate: Number of legal units Current rents Market rents Vacancy history Property taxes Insurance Utilities Maintenance Capital expenditures Tenant leases Building condition Legal occupancy Zoning Potential renovation opportunities A multifamily property with below-market rents may offer a value-add opportunity, but investors need to understand applicable rent regulations and legal limitations before assuming rents can simply be increased. 2. Long-Term Rental Properties Long-term rentals can provide investors with recurring income while allowing them to hold an asset for potential long-term appreciation. This strategy may work particularly well in neighborhoods with: Strong employment access Reliable transportation Schools and universities Restaurants and retail Parks and recreational facilities Hospitals and medical centers Low rental vacancy Strong tenant demand Investors should calculate potential rental income conservatively. Instead of using the highest rent found online, compare several similar properties based on location, size, condition, amenities, and building type. Then subtract realistic operating costs. A basic investment calculation looks like: Gross Rental Income − Operating Expenses = Net Operating Income (NOI) Operating expenses can include property taxes, insurance, maintenance, repairs, management, utilities, vacancy, legal expenses, and other recurring costs. If financing is involved, investors should separately calculate mortgage payments and other debt-related expenses to determine potential cash flow after financing. 3. Fix-and-Flip Properties Fix-and-flip investing involves purchasing a property that needs improvements, renovating it, and selling it for a higher price. New York City can provide opportunities for this strategy, particularly when investors identify properties that are outdated, poorly marketed, inherited, vacant, or otherwise in need of improvement. However, NYC fix-and-flip projects can become expensive quickly. Costs may include: Purchase price Closing costs Construction Materials Architect fees Engineering Permits Contractor costs Financing Property taxes Insurance Utilities Holding costs Selling costs The potential profit should therefore be calculated before making an offer. A useful formula is: Expected Sale Price − Purchase Price − Renovation Costs − Holding Costs − Financing Costs − Selling Costs = Estimated Profit Investors should also maintain a contingency reserve because renovation projects frequently encounter unexpected expenses. 4. Distressed and As-Is Properties Distressed properties can create opportunities for experienced investors who understand how to evaluate risk. Examples include: Foreclosures Inherited homes Vacant properties Fire-damaged houses Water-damaged properties Homes with deferred maintenance Properties requiring major renovations Properties with complicated ownership situations Tenant-occupied properties Homes being sold as-is The attraction is straightforward: a property requiring significant work may sell for less than a fully renovated comparable property. But investors should never assume that a low purchase price automatically represents a bargain. For example, a property purchased for $500,000 may initially appear attractive compared with renovated properties selling for $650,000. But if the renovation costs $100,000, holding costs reach $20,000, and closing and selling expenses add another $30,000, the potential margin can disappear quickly. The full investment equation matters more than the listing price. Which NYC Boroughs Offer Real Estate Investment Opportunities? New York City consists of five boroughs, and each has a different real estate profile. Manhattan Manhattan is one of the city’s most established real estate markets and offers luxury condos, co-ops, multifamily properties, rental apartments, commercial properties, and development opportunities. The borough can appeal to investors seeking premium locations and strong rental

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Essential Tips for First-Time Homebuyers in New York

Current Real Estate Trends in New York: What Buyers and Sellers Need to Know

How to Sell an Inherited Home in NYC

Leave a Comment / Cash Home Buyers, New York / Jeff

Inheriting a home in New York City can come with both financial opportunities and unexpected responsibilities. Along with the property, heirs may have to deal with probate or estate administration, property taxes, mortgage payments, maintenance, title issues, multiple heirs, and the emotional difficulty of handling a loved one’s belongings. Selling the property can be a practical option when you do not want to keep it, especially if the home needs repairs or several family members inherited an interest in it. The process starts by determining who has legal authority to sell the property, resolving any estate or title issues, understanding the home’s value, and deciding whether to sell traditionally or as-is. New York Courts explain that an executor or administrator may be responsible for collecting and appraising estate assets, paying debts and taxes, and distributing property according to the will or New York law. Can You Sell an Inherited House in NYC? Yes, an inherited house can be sold in NYC, but the person selling it must have the legal authority to complete the transaction. The process can vary depending on how the property was owned and whether the deceased person left a will. If the property was individually owned by the deceased, estate administration may be necessary before the authorized representative can complete a sale. New York Courts explain that, once formally appointed, an executor or administrator handles probate assets, including individually owned real estate. However, not every inherited property follows exactly the same process. The ownership structure, will, beneficiaries, joint ownership, trust arrangements, and estate circumstances can all affect what happens next. Step 1 — Determine Who Owns the Property Before listing an inherited home, determine how the property was owned. Check: The current deed The deceased owner’s estate documents Any will or trust Mortgage records Property tax records Existing liens Ownership interests of other people This step is important because you should not assume that the person named in a will can immediately sell the property. In some situations, ownership may pass differently depending on how the property was titled. Step 2 — Determine Whether Probate Is Required Probate is the court process used to validate a will and administer certain assets of a deceased person. If the deceased owned real estate individually, the estate may need a probate or administration proceeding before the property can be sold. New York’s Surrogate’s Court handles these proceedings. The court appoints a fiduciary, such as an executor or administrator, who then has responsibilities for managing the estate. What if There Is No Will? When someone dies without a will, they are considered to have died intestate. New York law determines who inherits the estate. The process can become more complicated when several family members have inheritance rights or disagree about what should happen to the property. If you’re unsure about the estate’s legal status, speak with a New York estate attorney before attempting to sell the property. Step 3 — Identify All Heirs and Beneficiaries Multiple heirs can make an inherited property sale more complicated. For example, three siblings might inherit a house together. If two want to sell but one wants to keep it, the family may need to reach an agreement or obtain legal guidance about the available options. Common situations include: One heir wants to sell All heirs agree to sell One heir wants to buy the others out Heirs disagree about the home’s value An heir lives outside New York An heir cannot be located The estate has outstanding debts Getting everyone on the same page early can prevent unnecessary delays. Step 4 — Determine the Value of the Inherited Home Before accepting an offer, determine what the property may reasonably be worth. You can consider: Recent comparable sales Neighborhood conditions Property size Location Current condition Renovation potential Rental potential Professional appraisal An inherited property may be worth significantly more or less than the amount the deceased originally paid for it. If multiple heirs are involved, an independent valuation can help reduce disagreements. Step 5 — Decide Whether to Repair or Sell the House As-Is One of the biggest decisions is whether to renovate the property before selling. Inherited homes often contain deferred maintenance because the previous owner may not have updated the property for many years. Potential issues may include: Old plumbing Electrical problems Roof damage Water damage Mold Structural issues Outdated kitchens Outdated bathrooms General deterioration When Repairs May Make Sense Repairs can make sense when the property only needs relatively inexpensive improvements that could increase buyer interest. Examples might include: Painting Cleaning Landscaping Minor repairs Removing clutter When Selling As-Is May Make More Sense Selling as-is may be worth considering when: The house needs extensive repairs You live outside NYC You want to avoid contractors The property has been vacant Multiple heirs want a quick resolution You don’t want to invest additional money You need to sell the property quickly CashBuyersNY says it purchases inherited homes in New York in their existing condition and offers a cash-sale option for owners who want to avoid repairs and a traditional listing process. What Taxes Apply When Selling an Inherited Home in NYC? Taxes are an important part of an inherited-property sale. The tax consequences can differ from those of selling a home you purchased yourself. Capital Gains and Stepped-Up Basis Inherited property generally receives a tax basis based on its fair market value at the owner’s death, subject to applicable tax rules. For example, if a property was purchased decades ago for $100,000 but had a fair market value of $600,000 when the owner died, the tax basis may be significantly different from the original purchase price. If the property is later sold for $625,000, the taxable gain may be based largely on the difference between the applicable inherited basis and the eventual sale price, rather than simply the difference between $100,000 and $625,000. Because tax treatment can depend on the estate and the property’s circumstances, consult a qualified tax professional before selling. What

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How to Sell a House in New York During a Divorce

Leave a Comment / New York / Jeff

Divorce can make almost every financial decision more complicated, especially when you and your spouse own a home together. For many couples, the marital home is one of their largest assets. Deciding whether to keep it, sell it, or have one spouse buy out the other’s interest can become an important part of the divorce process. If you’re wondering how to sell a house in New York during a divorce, it’s important to understand that selling the property is not simply a standard real estate transaction. You may need to consider ownership, marital property rules, mortgage obligations, taxes, closing costs, the home’s value, and how the proceeds will ultimately be divided. New York uses an equitable distribution system when dividing marital property. In general, marital property is divided fairly based on the circumstances rather than automatically split 50/50. This guide explains the major considerations involved in selling a house during a divorce in New York. What Happens to a House During a New York Divorce? The first question is whether the house is considered marital property, separate property, or a combination of both. New York generally distinguishes between marital and separate property when determining how assets are handled during divorce. Property acquired during the marriage will often be treated as marital property, although there can be exceptions and circumstances that affect how an asset is classified. For example, the situation may be more complicated if: One spouse purchased the property before marriage One spouse inherited the property Separate funds were used for the down payment Separate funds were used for major improvements The property was refinanced during the marriage The spouses signed a prenuptial or postnuptial agreement Ownership changed during the marriage New York courts determine property rights based on the applicable law and circumstances of the case. The New York Courts explain that marital property is subject to equitable distribution and that equitable does not necessarily mean equal. Because classification can affect your financial rights, you should discuss your individual circumstances with a qualified New York divorce attorney. Can You Sell a House During a Divorce in New York? Yes, a house can potentially be sold while a divorce is pending. However, whether and how the property can be sold depends on the circumstances of the divorce, the ownership structure, agreements between the spouses, court orders, and other legal considerations. If both spouses agree to sell, the process can generally be much more straightforward. The spouses can work with their attorneys and real estate professionals to establish: Whether the property should be sold The listing price How the property will be marketed How repairs will be handled How offers will be evaluated Who will pay expenses How the proceeds will be handled If the spouses cannot agree, the situation can become considerably more complicated. A court may ultimately determine issues involving the marital residence and property distribution. New York law gives courts authority to address the use and occupancy of the marital home as part of the equitable distribution process. Do Both Spouses Have to Agree to Sell the House? There is no one-size-fits-all answer. The answer can depend on how the property is owned, whether there are court orders, the terms of any agreement between the spouses, and the circumstances of the divorce. If both spouses own the property jointly, one spouse generally should not assume that they can simply sell the entire property without addressing the other spouse’s ownership rights. Similarly, a spouse whose name is not on the deed should not automatically assume they have no potential interest in the marital property. This is one of the most important reasons to involve a divorce attorney before making major decisions about a marital home. Step 1: Talk to Your Divorce Attorney Before Listing the Property Before putting the house on the market, discuss the proposed sale with your attorney. Your attorney can help you understand: Whether the property is marital or separate property Your ownership rights Whether an agreement is necessary Whether there are relevant court orders How proceeds may be handled How debts associated with the property may be treated Whether the sale could affect other aspects of your divorce This is especially important if you and your spouse disagree about selling the house. A real estate agent can help you market and sell the property, but they do not replace the role of a divorce attorney. Step 2: Determine How Much the House Is Worth Before deciding whether to sell, you need a realistic understanding of the property’s value. You can begin by getting a comparative market analysis from a local real estate professional. Depending on the circumstances, you may also want a formal appraisal. An accurate valuation matters because the home’s value can affect: Equity calculations Buyout negotiations Settlement discussions Listing price Expected proceeds Property division New York courts may consider the value of marital property when determining equitable distribution, and recent New York cases illustrate the importance of reliable valuation evidence when a marital residence is being divided or sold. Step 3: Calculate the Home’s Equity Knowing the home’s market value isn’t enough. You also need to determine how much equity exists. A simplified calculation is: Home Value − Mortgage Balance − Other Liens = Estimated Equity For example, suppose: Home value: $700,000 Mortgage balance: $420,000 Other lien: $20,000 Estimated equity would be: $700,000 − $420,000 − $20,000 = $260,000 But this isn’t necessarily the amount you’ll receive after selling. You may also have to account for: Real estate commissions Attorney fees Transfer taxes Recording fees Repairs Seller concessions Other closing expenses Your attorney, real estate professional, and closing professionals can help you estimate the actual net proceeds. Step 4: Determine Whether Selling Is Actually the Best Option Selling isn’t always the best solution. Depending on the circumstances, divorcing spouses may consider several alternatives. Option 1: Sell the House and Divide the Proceeds This is often the cleanest solution when neither spouse wants to continue owning the property. The house is sold,

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Tenants Rights When Landlord Sells Property in New York

Tenant Rights When a Landlord Sells Property in New York

Leave a Comment / New York / Jeff

When a landlord decides to sell a rental property, tenants often wonder what will happen to their lease, rent, security deposit, and right to remain in the home. Selling a rental property does not automatically cancel a tenant’s lease or allow the new owner to remove the tenant immediately. New York tenant rights depend on factors such as the lease, type of tenancy, property location, and whether the apartment is rent-regulated. When ownership changes, the new owner generally takes over the landlord’s responsibilities, including properly handling the tenant’s security deposit. Understanding these rules helps landlords avoid delays, disputes, and closing problems when selling a tenant-occupied property. Can a Landlord Sell a Property With a Tenant Living in It? Yes. A landlord can generally sell a rental property even when a tenant is living there. A tenant does not necessarily have to move out simply because the property is listed for sale. The landlord can market the property and look for a buyer while the tenant remains in possession, subject to applicable laws and the terms of the lease. New York law provides that when leased property is transferred, the new owner generally obtains the landlord’s rights and obligations under the lease. What happens after the sale? Depending on the circumstances: The tenant may remain in the property. The new owner may become the landlord. The existing lease may continue. Rent may continue under the existing terms. The security deposit must be properly handled. The tenant may receive information about the new owner and where rent should be paid. The sale itself does not automatically mean the tenant must leave. Does a Tenant Have to Move Out When the Landlord Sells the House? Not necessarily. If the tenant has a valid fixed-term lease, the sale generally does not by itself terminate the lease. For example, if a tenant has a lease running through December and the landlord sells the property in June, the tenant may generally continue occupying the property according to the lease terms. The buyer should review the existing lease before purchasing the property and understand the tenant’s rights and the landlord’s obligations. Important exception The exact answer can depend on: The lease language Whether the lease has expired Whether the property is rent-regulated Whether good-cause protections apply The property’s location Whether the tenant has violated the lease Whether a legal eviction proceeding is involved This is why landlords and buyers should review the tenancy before assuming that a property can be delivered vacant. What Happens to the Lease When a Rental Property Is Sold? In many situations, the existing lease continues after the sale. New York Real Property Law § 223 provides protections concerning rights and remedies when leased property or the landlord’s interest is transferred. The new owner may inherit responsibilities involving: Rent collection Required repairs Maintenance obligations Lease terms Security deposits Services and amenities included in the tenancy The tenant should not assume that the lease disappears because the property’s deed changes hands. Likewise, the new owner should obtain and review all existing leases before closing. Can the New Landlord Increase the Rent After Buying the Property? Not simply because the property was sold. If a tenant is still protected by a fixed-term lease, the new owner generally cannot simply disregard the existing lease and impose completely new terms before the lease expires. However, rent increases and renewal rights can depend on the type of tenancy and whether the property is subject to rent regulation or other applicable protections. Before changing rent, the new owner should determine: Whether there is a written lease When the lease expires Whether the property is rent-stabilized Whether the property is rent-controlled Whether good-cause protections apply What notice is legally required Whether local rules apply New York’s tenant-protection laws can be complicated, particularly in New York City. What Happens to the Tenant’s Security Deposit When the Property Is Sold? A security deposit does not simply disappear when a landlord sells the property. The New York Attorney General explains that when a building is sold, the landlord generally must transfer the security deposits to the new owner within five days or return them to the tenants. Tenants must also be notified of the new owner’s name and address by registered or certified mail. Tenants should keep records of: Original security deposit amount Proof of payment Lease agreement Correspondence with the previous landlord Notices from the new owner The tenant may need these records later if there is a disagreement about the deposit. Can a Landlord Show a Tenant-Occupied Property to Buyers? Generally, a landlord may need access to the property for legitimate purposes such as inspections, repairs, or showings, but the landlord must respect the tenant’s rights and the terms of the lease. Landlords should: Give appropriate notice Schedule showings reasonably Avoid unnecessary disruption Respect the tenant’s privacy Follow the lease and applicable law A property sale does not eliminate a tenant’s right to peaceful enjoyment of the rental. Tenants should also cooperate reasonably Tenants generally should not intentionally prevent lawful access when proper notice has been given. The best approach is usually to agree on reasonable showing times and maintain communication throughout the sale. Can a Landlord Evict a Tenant Just Because the Property Is Being Sold? A landlord cannot simply force a tenant out because the landlord wants to sell the property. New York law restricts unlawful eviction and prohibits certain self-help tactics against occupants who have legally occupied a dwelling for 30 consecutive days or longer or who have entered into a lease. Removal generally requires lawful authority, such as a court warrant or other legally authorized order. Whether a landlord can terminate a particular tenancy depends on the applicable law and facts. Potential issues include: Nonpayment of rent Lease violations Expiration or termination of a tenancy Applicable good-cause requirements Rent regulation Owner-occupancy situations Local housing laws Because eviction law is highly fact-specific, landlords should obtain legal advice before serving notices or beginning an eviction case. What If

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Selling Your Home With Solar Panels in New York (2024 Guide)

Selling a Home With Solar Panels in New York

Leave a Comment / New York / Jeff

For homeowners, solar panels can be an attractive feature because they may reduce electricity costs and make a property appealing to buyers interested in energy efficiency. However, selling a solar-equipped home is not always as simple as selling a house without solar. The most important factor is how the solar system is owned or financed. If you own the panels outright, the sale may be relatively straightforward. If the system is leased, financed, or covered by a power purchase agreement (PPA), the buyer may need to qualify for or assume the remaining obligation, or the seller may need to satisfy the agreement before closing. NYSERDA specifically recommends reviewing the ownership-transfer provisions in the solar contract before selling. Before listing your home, determine exactly what you own, what you owe, what paperwork exists, and what obligations will transfer to the buyer. Can You Sell a House With Solar Panels in New York? Yes, you can sell a house with solar panels in New York. Solar panels do not prevent you from selling your property. The challenge is making sure the solar system’s ownership, financing, warranties, and contractual obligations are properly handled as part of the transaction. The process can be easier when you own the system outright because there may be no remaining solar payment for the buyer to assume. A leased or third-party-owned system can require additional coordination between: Seller Buyer Solar company Lender or financing company Real estate professionals Closing attorney NYSERDA notes that third-party solar ownership can complicate a home sale because a buyer may need to be approved to assume the lease or PPA, while some sellers may instead need to buy out the system. Do Solar Panels Increase Home Value in New York? Solar panels can contribute to a home’s appeal and value, but there is no universal dollar amount that every solar-equipped home will gain. The effect can depend on several factors. Factors that can affect solar panel value 1. Ownership An owned solar system may be easier for buyers to understand because there is no separate lease payment or PPA obligation. 2. Age of the system Newer panels and equipment may be more attractive than an older system approaching the end of its useful life. 3. System performance Buyers may want to know how much electricity the system produces and how much energy it has historically saved. 4. Remaining warranties Transferable warranties can make the system more attractive. 5. Financing obligations A buyer may be less interested if taking over the solar agreement creates a significant monthly obligation. 6. Local electricity costs The potential value of energy savings can vary depending on utility rates and the property’s location. Rather than assuming that solar automatically adds a specific amount to your home’s value, sellers should provide buyers with documentation showing the system’s actual benefits. Determine Who Owns the Solar Panels Before Selling This should be one of the first things you do. There are generally several ways a residential solar system may be financed or owned. Option 1 — You Own the Solar Panels Outright If you paid for the system yourself and there is no remaining financing obligation, the solar equipment is generally part of the property being sold. You should gather: Installation documents Equipment specifications Warranties Permits Maintenance records Utility information System production records This information can help buyers understand exactly what they are purchasing. Selling a House With a Solar Loan If you financed your solar panels with a loan, the selling process depends on the specific loan agreement. Not every solar loan works the same way. For example, NYSERDA explains that certain residential financing programs have different rules when a property is sold. An On-Bill Recovery Loan may be transferable to a new owner under specified conditions, while its Smart Energy Loan information states that the homeowner remains responsible for the balance if the property is sold or transferred. Before listing your house, find out: Current loan balance Monthly payment Interest rate Whether the loan is secured or unsecured Whether the balance can transfer Whether the lender requires payoff Whether the loan creates a recorded obligation Whether the buyer must qualify Never assume that a solar loan automatically transfers to the buyer. Read the contract and contact the lender before accepting an offer. Selling a House With Leased Solar Panels A solar lease means a third party typically owns the solar equipment while you pay according to the lease agreement. This can make selling more complicated. NYSERDA notes that under third-party ownership, the homeowner can generally transfer a solar lease or PPA to the next homeowner if the buyer meets the applicable approval requirements. However, the exact contract controls the process. A buyer may need to: Apply for the transfer Meet credit requirements Sign new documents Accept remaining payments Review system warranties Agree to the lease terms If the buyer does not want to assume the lease, you may need to explore a buyout or another solution permitted by your contract. Selling a Home With a Power Purchase Agreement (PPA) A Power Purchase Agreement, or PPA, is another type of third-party solar arrangement. Under a PPA, the homeowner generally pays for the electricity produced by the solar system rather than simply paying for the equipment itself. The agreement may contain specific requirements for selling the property. If you have a PPA, check: Remaining contract term Price per kilowatt-hour Transfer requirements Buyer qualification requirements Buyout provisions Early termination costs System ownership Maintenance responsibilities NYSERDA recommends reviewing the contract’s homeownership-transfer provisions before selling because these provisions determine what happens to the agreement when the property changes hands. What Documents Do You Need to Sell a House With Solar Panels? Having the right paperwork can make the transaction much easier. Gather these documents before listing: Solar purchase agreement Lease agreement, if applicable PPA agreement, if applicable Solar loan documents Current payoff statement Equipment warranties Installer warranty Maintenance records Permits Interconnection documents Utility statements Recent solar production information Equipment specifications Transfer paperwork Give these

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Squatters’ Rights in New York: What Property Owners Need to Know

Who Pays Closing Costs in New York: Buyer or Seller?

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The buyer usually pays costs related to financing, title services, inspections, and certain prepaid expenses, while the seller commonly pays expenses such as New York State transfer tax, applicable real estate commissions, and certain payoff or transaction costs. However, closing costs are not fixed and some expenses may be negotiated in the purchase agreement. The total amount depends on whether you’re buying or selling, the property’s location and price, whether financing is involved, and the terms agreed upon by both parties. Understanding these costs before closing can help you avoid surprises and accurately calculate your total cash needed or net proceeds from the sale. What Are Closing Costs in New York? Closing costs are the fees, taxes, and other expenses associated with completing a real estate transaction. They are separate from the purchase price of the property. For buyers, closing costs can include expenses related to financing, title, inspections, recording, and prepaid items. For sellers, closing costs can include transfer taxes, commissions or other agreed compensation, attorney fees, mortgage payoff costs, and adjustments. Closing costs can include: Attorney fees Title insurance Mortgage-related fees Recording fees Transfer taxes Property tax adjustments Home inspections Appraisal fees Survey costs when applicable Recording expenses Prepaid insurance and taxes Mortgage payoff costs Brokerage compensation when applicable Not every transaction includes every expense. Who Pays Closing Costs in New York? There isn’t one single rule that says the buyer or seller pays all closing costs. Instead, each side normally pays certain costs associated with their part of the transaction. Generally: Buyers may pay: Mortgage-related costs Lender fees Appraisal Home inspection Title insurance Buyer’s attorney Recording fees Prepaid taxes and insurance Sellers may pay: New York State transfer tax Applicable real estate brokerage compensation Seller’s attorney Mortgage payoff expenses Certain municipal or transaction-related charges Property tax adjustments The exact allocation should be confirmed with the attorneys, title company, lender, or closing professionals handling the transaction. What Closing Costs Does the Buyer Pay in New York? Buyers should budget for more than just the down payment. Depending on the transaction, buyers may have several additional expenses before or at closing. Common buyer closing costs include: Mortgage and lender fees If you are financing the purchase, your lender may charge fees related to processing and originating the mortgage. These can include: Origination charges Underwriting fees Credit report fees Appraisal fees Discount points The exact amount depends on your lender and loan. Title insurance Title insurance protects against certain covered title problems that could affect ownership rights. The cost can vary depending on the property and transaction. Home inspection A buyer commonly pays for the home inspection. This gives the buyer an opportunity to identify potential issues before completing the purchase. Attorney fees New York real estate transactions commonly involve attorneys representing the buyer and seller. The buyer is generally responsible for paying their own attorney. Recording fees Government recording charges may apply when documents are recorded after closing. What Closing Costs Does the Seller Pay in New York? Sellers also have several expenses to consider when calculating their net proceeds. Common seller expenses include: New York State transfer tax New York imposes a real estate transfer tax on certain transfers of real property. The seller is generally responsible for this tax, subject to applicable law and transaction-specific circumstances. Real estate brokerage compensation If the seller uses a real estate professional, the seller may have an agreement requiring payment of brokerage compensation. The amount and structure are determined by the agreement. Seller’s attorney The seller generally pays their own attorney’s fees. Mortgage payoff If the property has an outstanding mortgage, the seller must generally pay the remaining loan balance from the transaction proceeds. There may also be payoff-related fees. Property tax adjustments Property taxes and other expenses may be prorated between the buyer and seller depending on the closing date and the terms of the contract. Does the Buyer or Seller Pay Transfer Tax in New York? The seller generally pays the New York State real estate transfer tax. New York’s transfer tax generally applies when real property is transferred for consideration above applicable thresholds. The amount is based on the consideration paid for the property and the applicable tax rules. Why transfer tax matters to sellers Transfer tax reduces the amount of money the seller ultimately receives from the sale. For this reason, sellers should calculate their estimated net proceeds, rather than looking only at the property’s sale price. Who Pays the Property Taxes at Closing? Property taxes are often prorated between the buyer and seller. The closing statement accounts for the portion of taxes attributable to each party based on the closing date and local tax schedule. For example If the seller has already paid property taxes covering a period that extends beyond the closing date, the buyer may reimburse the seller for the buyer’s portion through a closing adjustment. If taxes haven’t been paid for a period during which the seller owned the property, the seller may owe the appropriate amount at closing. The exact calculation depends on the property’s tax schedule and contract. Who Pays the Real Estate Attorney Fees in New York? Typically, each party pays their own attorney. The buyer generally hires an attorney to represent the buyer’s interests, while the seller hires an attorney to represent the seller. What does a real estate attorney do? An attorney can help: Review the purchase contract Negotiate contract terms Review title issues Prepare or review closing documents Address liens or legal issues Coordinate with the lender and title company Explain closing documents Handle legal aspects of the closing Having your own attorney helps ensure your interests are represented throughout the transaction. Who Pays for Title Insurance in New York? In many New York transactions, the buyer pays for the owner’s title insurance policy. Title insurance helps protect the buyer against certain covered title defects and claims. Title problems can include: Unknown liens Ownership claims Recording errors Forgery Certain historical title defects The exact title insurance

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