The list price is not
comparable to a resale price
Sponsors customarily shift the New York City and State transfer taxes onto the buyer — roughly 1.8 to 2.0% of the price — before adding their attorney fees and a working capital contribution.
Before you read on
- General information as of August 2026. Every sponsor contract is different and the offering plan governs — have your attorney read it.
- Customary allocations are contractual, therefore negotiable in principle even where they are presented as fixed.
- Nothing here is legal or tax advice.
Point 1What a sponsor contract adds
Three items that never appear in the marketing and always appear in the offering plan.
| Cost | Resale | New development |
|---|---|---|
| Mansion tax above $1M | Buyer | Buyer |
| NYC transfer tax, 1.425% above $500k | Seller | Buyer, customarily |
| NYS transfer tax, 0.4% | Seller | Buyer, customarily |
| Sponsor's attorney fee | Not applicable | Buyer, commonly |
| Working capital contribution | Not applicable | Buyer, 1–2 months of charges |
| Total buyer closing costs | 2–5% | 4–6% |
On a $3 million apartment the shifted transfer taxes alone are $54,000 to $60,000 a resale buyer would not pay.
Point 2The first-year budget is a projection
Staffing is guessed before anyone knows how the building runs, insurance is quoted without a claims history, and reserves are set at a level that helps units sell.
Compare the projected charge per square foot against operating buildings of similar scale and staffing in the same area. A five-minute check.
While a significant block remains unsold, budgets and reserve contributions are set by the party still selling apartments.
A sponsor holding a large block can dispose of it in bulk at a discount, resetting the comparables under your own resale.
Model the unabated tax as the baseline. An abated bill is temporary by design and steps up on a published schedule.
New construction carries warranty periods. What survives them becomes an owners' problem funded from reserves.
Point 3Pre-construction: who carries the gap
A contract may close one to three years after signing, and no lender commits terms that far ahead.
Deposits are staged — commonly 10% at contract with further instalments at construction milestones — and all of it is cash rather than financed. New York requires sponsor deposits on residential new construction to be held in escrow under the offering plan; confirm the escrow terms and release conditions with your attorney before signing.
Three risks sit in the gap and all belong to the buyer: interest rates, which may be materially higher at closing; appraisal, if the completed unit values below the contract price; and currency, for a buyer funding from another currency across a multi-year schedule. A buyer who could close in cash if financing disappoints carries that gap comfortably. One who cannot should buy completed inventory.
Point 4Where concessions are actually available
Sponsors protect the recorded price because it sets the comparable for every remaining unit. They are far more willing to absorb their own transfer taxes, credit the working capital contribution, or cover their attorney fee — the same economic outcome in a form that does not appear in the public record.
Flexibility follows inventory. Early in a sell-out with strong absorption the answer is usually no. Late in a sell-out, on the less desirable exposures, it frequently is not. Ask for the concession in a form the sponsor can grant and the same result becomes achievable when a price reduction is not.
Sponsors customarily shift the New York City and State transfer taxes onto the buyer, and often add their attorney fee and a working capital contribution. Budget 4-6% rather than 2-5%.
A one-time payment into the building's reserve fund at closing, commonly one to two months of common charges. It is separate from the purchase price.
Concessions are more available than headline price cuts, because a recorded price sets the comparable for remaining units.
New York requires sponsor deposits on residential new construction to be held in escrow under the offering plan. Confirm the terms and release conditions with your attorney.
That risk sits with the buyer. A commitment obtained near closing reflects rates at that time, not at contract.
Procedurally yes — no board approval vote, entity and non-resident ownership accepted, and a sponsor accustomed to international purchasers. The diligence burden is financial rather than social.
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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.