Manhattan Real Estate has long been in high demand among buyers and foreign investors; properties here are very valuable due to the prime location. New York City is considered to be the capital of the world as you might have heard numerous times, and in fact it is. The best of all industries are concentrated in Manhattan including arts, culture, banking, commerce, fashion, television, filmmaking, advertising, marketing etc. New York also offers a long list of events that attract people from all over the world, whether for conferences, concerts, or just visiting. Point is residences in key locations are always sought after.
As a buyer, local or foreigner you may have a lot of questions regarding how New York real estate works. I have put together a guide that will help you answer these questions.
It is important to understand that regardless of the New York property ownership you select, there will be expenses in addition to the purchase price. Fortunately, a lot of these expenses are tax-deductible like the carrying charges, real estate taxes and the interest that co-op shareholders pay on the mortgage.
The Real Estate market in the NYC is very friendly to foreign investors; at the moment, townhouses and condominiums are the most popular purchases. When you buy a condo you own the apartment you purchased and share the common areas with the other building residents. Over the past years numerous new condominiums have been constructed in Manhattan, and many older buildings have been renovated into condos with the addition of modern amenities. Over the first 10-25 years savings in taxes can be significant for these owners. Today in New York condos account for over one-fourth of the real estate market.
The biggest challenge of buying a co-op is getting approval from the board. This step is difficult for both US citizens and foreign buyers, the boards tend to be very demanding and being from a different country can add another layer of difficulty. Buyers that appeal to co-op boards are those who indicate that they will be good neighbors, easy to get along with and that will contribute financially to the building’s maintenance. They prefer that the potential residents have a nearly perfect credit score and jobs in New York. The most significant challenge for foreign buyers is having a US tax return, a requirement for many co-ops.
I will be more than happy to help you find a property; I have access to numerous listings of apartments available in the market. We can talk about your preferences as far as building type, size, amenities etc. then we set out on the search. I have extensive experience in Manhattan real estate and I will be able to provide you with a detailed comparable market analysis and advice. The process of buying New York Real Estate can be complicated, there are many documents that need to be presented, and finding the property that suits your needs can be time consuming. You also have to find a mortgage broker and a lawyer. For foreign investors things can get even more complicated, especially when tax documents play such a big role when buying property. I am able to personalize your search and guide you through every step of the process. Here are some of the costs and information on the taxes that you will need to know
Both buyers and sellers have to pay the closing costs, they range anywhere from 1-8% of the purchase price. Federal, state, city, registration, and legal fees are required along with the down payment. These are the costs
Real Estate in NYC continues to be a great investment option; the long-term growth and home value appreciation is favored by the extremely high demand. Even though condos can be expensive, they are the number one choice for foreign investors; they are expected to outperform the rest of NYC real estate over a number of years to come. It is especially a great investment for foreign buyers whose currencies are stronger.
Even though the economy may be troubling at the moment, trends indicate that things will continue to go well for NYC real estate. There are numerous new condominiums buildings all over Manhattan that are attracting people from all over the world. Also, interest rates on mortgages are at historical lows and as the economy recovers, the government has announced that the rates will remain low until 2014.
There are several advantages on having a broker, as your broker I can intercede on your behalf for a price reduction or request concession.
In order to make sure you get the property you want and the best possible price, it is important that you have representation from an experienced broker. If you don’t have one you can find yourself losing money as a result of not knowing the ropes.
My job as a broker is to run the entire process smoothly and quickly, my access to the many properties in Manhattan and the many years of experience will be to your entire benefit as the buyer. I will help you gather the proper documents, guide you through certain applications and coordinate a team of professionals that will work to complete the purchase.
In New York City local or international buyers do not pay brokerage fees. The fees are paid by the seller and then divided between the buyer’s broker and the seller’s broker; this fee is 6% of the purchase price.
Is very important to have an attorney, they are needed to obtain insurance, to research on the title and any violations or lieu’s on the building. They also negotiate the contract, which is the initial agreement that leads to the deposit.
The appraisers are needed to research a NYC’s property’s fair market value. Surveyors research the condition of the property. Architects are hired to check a property’s measurements and finally the mortgage brokers come into place in order to help the buyer obtain a loan.
Tax abatements are programs that allow taxpayers to be granted a reprieve from paying a certain tax for a period of time, for either a total or a percentage of that tax. Is a motivational tax, intended to encourage real estate developers in New York to keep building and enhancing neighborhoods. The tax status a building qualifies for is dependent on the specifics of any given building. I can advise an owner about his or her property’s tax status.
This process is relatively hassle-free. All you need to do is have your tax returns from the past three years, bank account information, proof of employment, references, last pay stubs and proper identification. After completing the initial application you will work directly with your mortgage broker. If you qualify for a mortgage today you will most likely get a great deal, interest rates on mortgages are at historical lows.
It is not as challenging as one may think. Most of the banks in the United States now have programs in place intended specifically for foreign buyers. Banks are able to finance 65-75% of their loans, up to $1 million and 60% of their loans that fall in the range of between $1 and $2 million. Foreign buyers are asked to provide a number of specific documents. Such as:
Though some banks waive this requirement, buyers are then charged higher interest rates.
It can be beneficial to buy a home through a Limited Liability Company, or LLC. However, treaties between the US and that specific foreign country can diminish the advantages for foreign buyers. An international purchaser really should enlist a tax adviser who specializes in international law to help. I can help you find one.
Important things to know about LLCs:
Tax liability for non-US residents is different than for residents. Here is a breakdown,
At the time of the closing, the attorney records the details of the buyer
And then submits them in to the NYC Register. Documents are photocopied, photographed, and filed.
There is a thriving market in New York City for rentals, even when rent prices can be extremely high, a lot of people still choose them over buying their own property. There is also a low vacancy rate, which means that a buyer will easily find regular tenants. Most of NYC buildings only offer long-term leases or 6+ months, but some allow for shorter-term arrangements like month to month. There are companies that specialize in temporary furnished rentals, so as a buyer that may be an option you would like to keep, especially if you sometimes will like to vacate your own property for a short period of time. If you plan on buying a NYC apartment in order to rent it out I will be happy to help you with the process from beginning to end.