Property Buying & Selling in New York

    Real estate transactions in New York can appear complex to some buyers or sellers, particularly due to the mandatory involvement of attorneys and the rigorous due diligence required. However, you can improve the chances of being successful in the Empire State property market by understanding market conditions, verifying ownership, and resolving any outstanding liens or title issues.

    Understanding the Real Estate Market in New York

    New York experiences both buyer's and seller's markets, like other states in the United States. A buyer's market is when there are more homes for sale than buyers, while a seller's market occurs when demand for homes exceeds supply. In urban areas like New York City, competition and pricing trends can shift rapidly, while more rural counties may move at a slower pace.

    In recent years, many parts of New York, particularly the metro areas, have seen historically tight supply, driven in part by high-interest rates, leading to a continuation of competitive conditions, especially for desirable properties.

    In a seller's market, there is usually more demand than supply, so buyers face competition from others for the limited inventory and must move quickly to secure their choices. In a buyer's market, there is more supply than demand, so sellers need to set a more competitive price and be flexible in negotiations to avoid delayed sales. Due to the dynamics of these markets, knowing the local market conditions helps both sellers and buyers alike to make better decisions about timing, pricing, and what to expect.

    Buying a Property in New York

    The process of buying a home in New York involves several steps, including:

    • Finding a Property: Buyers can search through agents, listings, or public platforms to identify a property of their choice.

    • Due Diligence: After identifying a property, buyers conduct due diligence by reviewing public records for:

      • Ownership

      • Existing mortgages or HELOCs

      • Open liens or judgments

      • Past sales history

    • Offer and Contract: Once an offer is accepted, a contract is prepared by the seller's attorney and reviewed by the buyer's attorney. This contract is typically signed after the home inspection.

    • Attorney Review and Title Search: The buyer's attorney orders a title search from a title company.

    • Closing: Attorneys in New York are required to prepare the contract and oversee the closing, ensuring legal compliance and proper fund transfer. At closing, all necessary documents are signed, and the seller issues the deed to transfer the property. The buyer's attorney or title company records this deed and the new mortgage (if applicable) with the county clerk, officially establishing the new ownership on the public record.

    Selling a Property in New York

    Selling a property in New York typically follows these steps:

    • Preparing the Property: This includes repairs, staging, and gathering important documents.

    • Listing and Marketing: The home is listed for sale through a chosen method (agent, FSBO, or discount brokerage).

    • Disclosures and Records: The State of New York requires a mandatory 56-question disclosure form on structural issues, hazards, and flood risks (per the New York Real Property Law 462, also known as the Property Condition Disclosure Act). Also, sellers may need to share copies of the deed, details about any remaining mortgage, and information about utilities or HOA rules.

    • Offer and Negotiation: Offers from prospective buyers are reviewed and negotiated.

    • Title and Payoffs: A title search ensures there are no legal encumbrances, and any outstanding loans or liens are paid off at closing.

    Buying and Selling at the Same Time in New York

    Simultaneously buying a new home and selling the existing one is common in New York. However, coordinating the transactions at the same time can be challenging. To ensure a smooth process, timing is important.

    Usually, a buyer who needs to sell their current home first attempts to include a sale contingency in their offer on the new property. However, in a seller's market, many sellers often reject this contingency since it adds significant risk of delay.

    Ideally, the sale closing happens immediately before the purchase closing on the same day. The funds from the sale are wired directly to the purchase closing to cover the down payment and closing costs.

    Since closings in New York are often scheduled for an “on or about” date, a delay in the sale closing can prevent the buyer from funding their purchase closing. A buyer causing a delay may face daily penalties (per diem) or risk losing their contract deposit on the new property.

    Solutions often involve negotiating a post-closing possession agreement (where the seller temporarily rents back the home) or securing a short-term bridge loan to cover the gap in funding.

    Records to Review Before Buying or Selling

    The table below identifies the records to review before buying or selling a property and why reviewing such records matters:

    FAQs

    Review the last recorded deed at the local county clerk's office or the city register's office. This document publicly names the current grantor (seller) and grantee (owner).

    Sellers should review their original deed, their current mortgage statement, and any record of unsatisfied liens or judgments to identify and resolve issues that would otherwise stall the closing.

    Yes. The mortgage is typically paid off using proceeds from the sale during closing.

    They must be resolved before or at closing. Title companies will not insure a property with unresolved liens.

    Your attorney may be able to negotiate an extension to let you stay in your current home past the original closing date. However, this often means paying a daily fee (called a per diem) to the buyer, or arranging a short-term bridge loan to cover the time between closings.