Frequently Asked Questions
Find answers to common real estate questions
The NY State Mansion Tax is a one-time closing cost of 1% on residential purchases of $1,000,000 or more. In NYC, this is a progressive tax that scales up to 3.9% for properties over $25M. It is paid by the buyer at closing and cannot be financed into your mortgage.
Expect to pay between 3% and 5% of the purchase price. Key costs include the NYS Mortgage Recording Tax (varies by county), Title Insurance (approx. 0.4%-0.5%), Attorney Fees ($1,500-$3,000), and the Peconic Bay Tax if buying on the East End.
This is a 2% transfer tax on real estate transfers in the five East End towns (Riverhead, Southold, Shelter Island, Southampton, East Hampton). It generally applies to the portion of the purchase price exceeding a specific exemption limit ($200,000 for improved properties in most towns).
Yes. Real estate commissions are not set by law and are fully negotiable. In New York, the seller typically pays the commission for both the listing agent and the buyer's agent, but recent industry changes mean buyer's agent compensation is now explicitly negotiated in the purchase offer.
A Jumbo Loan is any mortgage that exceeds the conforming loan limit set by the FHFA. For high-cost areas like Nassau and Suffolk, this limit is typically higher than the national average (check current year limits, approx. $1.2M+). These loans often require higher credit scores (700+) and larger down payments (20%+).
A Village is an incorporated municipality with its own local government, mayor, and often its own police force, zoning laws, and sanitation (e.g., Garden City, Southampton). A Hamlet is an unincorporated area governed directly by the Town (e.g., Merrick, Syosset). Villages often have higher taxes but more localized services.
Grievance Day is the specific deadline (usually in May for Nassau/Suffolk) to formally challenge your property's assessed value. If successful, your assessment—and thus your tax bill—is lowered. It does not lower the tax rate, only your property's valuation relative to neighbors.
It depends on your specific FEMA flood zone. While "X" zones are low-risk and don't require it, "AE" or "VE" zones (coastal/waterfront) mandate flood insurance if you have a federally backed mortgage. Even in low-risk zones, it is highly recommended for luxury waterfront properties due to increasing storm surges.
This refers to properties located between Montauk Highway (Route 27) and the Ocean. Historically, this area commands the highest real estate values due to proximity to the Atlantic Ocean beaches, estate-sized lots, and exclusivity compared to "North of the Highway" (Bay side).
Laws vary strictly by Town and Village. While NY State is pushing for more ADUs, many local Long Island municipalities have opted out or have strict zoning codes preventing detached rental cottages. You must check the specific Certificate of Occupancy (CO) requirements for the exact address.
On average, 60 to 90 days from an accepted offer. New York is an "Attorney State," meaning contracts are reviewed by lawyers, not just title companies. Co-op boards can extend this timeline significantly due to the interview and application review process.
A binder is a preliminary agreement accompanied by a small good-faith deposit (often roughly 1% of the offer price) to show buyer intent. It is generally not binding until formal contracts are signed by both parties and the full down payment is in escrow.
Unlike many other states, NY customs and contracts are complex. An attorney protects your interests by reviewing the title report for liens, negotiating the "Riders" (addendums) to the contract, and ensuring the deed transfer is legally compliant.
A CO certifies that a building's use is legal and safe. If a previous owner finished a basement, added a deck, or converted a garage without permits, the home may lack a valid CO. This can prevent a bank from issuing a mortgage until the violations are legalized or removed.
We generally advise against fully waiving inspections on luxury homes due to complex systems (HVAC, pool pumps, smart home tech). Instead, consider an "Information Only" inspection or a "Cap" clause, where you agree to cover the first $5k-$10k of repairs but retain the right to cancel for major structural issues.
For the fastest LIRR commute (<35 mins), look at Great Neck, Manhasset, and Port Washington. For a balance of space and speed (<45 mins), consider Garden City or Rockville Centre.
Top-tier options include The Buckley Country Day School (Roslyn), Friends Academy (Locust Valley), and Chaminade High School (Mineola). These schools often feed into Ivy League universities and offer extensive athletic and arts programs.
Condos are "real property" (you own the unit) and generally have higher price points but fewer sublet restrictions and lower monthly fees. Co-ops (you own shares in a corporation) are cheaper to buy but have stricter Board approval, higher monthly maintenance (often includes taxes), and rigorous subletting rules.
There is no specific "penalty tax" for leaving. However, if you sell your home, you may owe Capital Gains tax if the profit exceeds the federal exclusion ($250k single/$500k married). NY also audits high-earners claiming a domicile change aggressively, so ensure you sever all "Teddy Bear" ties (primary doctor, gym, etc.).
Yes, but most Towns require a Rental Permit. Short-term rentals (under 14 days) are heavily restricted or banned in many Villages to preserve neighborhood character. You must register with the Town and pay the occupancy tax.
Historically, yes. Long Island's "Gold Coast" and Hamptons markets are supply-constrained (very little new land), which keeps asset values high. Luxury real estate here often outperforms the S&P 500 during high-inflation periods due to tangible scarcity.
A 1031 Exchange allows investors to defer capital gains taxes by reinvesting proceeds into a "like-kind" property. Strict rules apply: the property must be held for investment or business use (rental), not personal enjoyment. You cannot 1031 into a primary residence immediately.
The Federal SALT (State and Local Tax) deduction is capped at $10,000. Since LI property taxes often exceed $20k-$30k, this limits federal write-offs. However, NY State introduced the "PTET" (Pass-Through Entity Tax) which allows some business owners/LLCs to work around this cap.
Privacy (shielding your name from public records) and Liability Protection. It is common for high-net-worth buyers and celebrities. However, buying in an LLC may complicate financing (banks prefer individuals) and can trigger higher insurance premiums.
In luxury markets (North Shore/Hamptons), a pool is often expected and adds significant value (5-8%). In dense suburban areas (Queens/Western Nassau), it can sometimes be a deterrent to buyers who don't want the maintenance or liability, potentially shrinking your buyer pool.
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