Most first buyers are short
on two things
The cash required at closing beyond the deposit, and the liquidity a co-op board expects to see remaining afterwards. Both are knowable in advance and neither is negotiable at the last minute.
Before you read on
- General information as of August 2026. Figures are typical market practice rather than rules — buildings and lenders set their own requirements.
- Nothing here is legal or tax advice.
- Every requirement below can be assembled during the search, before an offer is accepted.
Step 1Four pools of cash, needed at different moments
Only the mortgage is financed. Everything else is cash.
| Requirement | On a $1,000,000 purchase | When |
|---|---|---|
| Contract deposit | $100,000 (10%) | At contract signing |
| Balance of down payment | $100,000 – $200,000 | At closing |
| Closing costs, resale condo | $20,000 – $50,000 | At closing |
| Mansion tax, included above | $10,000 (1%) | At closing |
| Post-closing liquidity, co-op | 1–2 years of maintenance | Demonstrated before approval |
Illustrative for a purchase with 20-30% down. Actual figures depend on the building, the lender and the price bracket.
The mansion tax deserves particular attention at this level. It applies from $1 million and is charged on the whole price rather than the amount above the threshold, which is why buyers and sellers routinely negotiate to $999,000 rather than just above the line.
Step 2The file, assembled during the search
A pre-approval follows an actual review of your documents. Sellers distinguish sharply between the two, and the process surfaces problems while there is still time.
Tax returns with schedules. Home-country returns are usually accepted with certified translation, which takes two to three weeks to arrange.
Large recent deposits will be questioned and need a written explanation. Prepare it rather than waiting to be asked.
Role, start date and salary. The self-employed provide an accountant's letter instead.
Two or three personal and two professional, addressed to the board. Generic letters are obvious and count for nothing.
The contract is negotiated by counsel here. A buyer still finding an attorney spends the first week of a 60-day clock looking.
Step 3Condo or co-op sets everything else
It determines the cash required, the documents demanded, the timeline, and what you may do with the apartment afterwards.
Co-ops trade 10-25% below comparable condominiums per square foot and are cheaper to close, with no title insurance and no mortgage recording tax. In exchange they require board approval, frequently higher down payments, demonstrated post-closing liquidity, and restrictions on subletting.
Condominiums cost more at every stage and impose almost no conditions: a right of first refusal rather than an approval vote, subletting generally permitted, non-resident and entity ownership accepted. For a first purchase the honest test is mobility — a buyer certain they will occupy the apartment for years should take the co-op discount.
Step 4Work backwards from the monthly figure
Before setting a price ceiling, total the monthly commitment: mortgage payment, common charges or maintenance, property tax where a condominium owner pays it directly, and a reserve for assessments. That combined number, not the purchase price, is what you live with.
In many New York buildings the charges and tax together approach the mortgage payment itself. A buyer who priced only the loan finds the real cost roughly double what they planned, which is the most common reason a first purchase becomes uncomfortable in year two.
Budget 2-5% of the price in closing costs for a resale condominium and 4-6% for new development, plus post-closing liquidity if a co-op board is involved.
Condominiums may accept 10-20% depending on the lender. Co-op boards frequently require 20-50% by building policy. Buyers without US credit typically face 25-30%.
The assets you hold after the purchase completes. Co-op boards test it directly, commonly expecting one to two years of maintenance to remain available.
Typically 60 to 90 days from accepted offer to closing when financed, and longer where a co-op board review is involved. Cash purchases can close in about 30 days.
Budgeting for the down payment and the mortgage while ignoring the monthly carrying cost. Charges plus tax frequently approach the mortgage payment itself.
Round-trip transaction costs of roughly 10-15% mean holds under five years rarely justify buying. Beyond five to seven years the arithmetic reverses.
RELATED GUIDES
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Important notice
The figures on this page are general information as of August 2026 and do not represent an offer, a quote, or a guarantee of any transaction terms. Reinvent NY does not provide legal, tax, or investment advice. Confirm anything material with an attorney and a CPA before you act on it. Nothing here is a solicitation to invest, and no return is promised. Real estate brokerage services are provided through R New York.