Selling a Home in New York: Contracts, Disclosures, Taxes, and Closing

In much of New York, the seller’s side typically drafts the contract, delivers the disclosure statement when one is required, works to resolve title objections as the contract provides, and generally pays the state transfer tax. The Real Estate & Closings practice group of Rausa Russo Law, PLLC represents sellers of houses, condominiums, and co-ops throughout New York State. Customs and costs vary by county and region, so use this guide as a map of the process and talk with an attorney about your own sale.

The Sale, Step by Step

1. Listing and preparation. Most sellers list with a broker. Before accepting an offer, gather your deed, survey, permits for past work, mortgage information, and, for a co-op or condo, the managing agent’s contact. The New York State Bar Association advises consulting an attorney “before you sign anything.”
2. The contract of sale. Downstate, according to the State Bar, “the seller’s attorney prepares the contract”; upstate, “a real estate agent often prepares the offer or contract, subject to the approval of the parties’ attorneys.” The contract sets the price, down payment, contingencies, and closing date.
3. The Property Condition Disclosure Statement. For most one- to four-family houses, you complete and sign the PCDS and deliver it before the buyer signs a binding contract.
4. The buyer’s mortgage and inspections. The buyer inspects the property and applies for financing, usually under a mortgage contingency with deadlines set in the contract.
5. Title issues. The buyer’s title company searches the records. Your attorney works through the objections, including payoff of your existing mortgage and any liens or judgments that turn up.
6. Transfer tax and closing documents. Your attorney prepares the deed and transfer tax returns. As the grantor, you are generally responsible for the New York State transfer tax.
7. Closing. You deliver the deed, existing loans and liens are paid from the proceeds, and the net proceeds are disbursed to you.
8. After closing. Confirm receipt of your proceeds and keep your closing statement for your tax adviser.

The Contract and the Down Payment

To be enforceable, a contract to sell New York real property generally must be in writing. Under General Obligations Law § 5-703(2), a contract “for the sale, of any real property” “is void unless the contract or some note or memorandum thereof, expressing the consideration, is in writing” and “subscribed by the party to be charged.” That is why everything you agree to, including what stays with the house, any credits, and the closing date, belongs in the signed contract.

Unless the contract says otherwise, the closing date is often more flexible than sellers expect. The Court of Appeals has held that “in contracts of this kind, time is not ordinarily of the essence unless the agreement so provides” (ADC Orange, Inc. v. Coyote Acres, Inc., 2006). Generally, either side can make a date firm by giving “clear, unequivocal notice” and a reasonable time to perform. If you need a firm date, ask your attorney whether a time-of-the-essence notice makes sense.

The buyer’s down payment is held in escrow under the contract. The State Bar frames the question as “Will an attorney or broker hold the deposit in escrow under appropriately worded escrow instructions?” The contract should answer that question. When an attorney holds funds belonging to another person, New York’s Rules of Professional Conduct (Rule 1.15) treat the lawyer as a fiduciary who may not commingle those funds with the lawyer’s own and must generally keep them in a special account titled as an attorney special, trust, or escrow account at a banking institution in New York State that has agreed to provide dishonored check and overdraft reports.

The Property Condition Disclosure Statement After the 2024 Changes

The Property Condition Disclosure Act (Real Property Law §§ 460–466) changed significantly in 2024. Chapter 484 of the Laws of 2023, signed September 22, 2023, took effect on March 20, 2024. It:

• Deleted the option of giving the buyer a $500 credit instead of delivering the disclosure statement;
• Rewrote the liability section (§ 465); and
• Added flood-related questions. The State Bar reports that the form grew from 49 to 56 items.

What you must do. Under § 462(1), the seller “shall complete and sign a property condition disclosure statement” and deliver it “to a buyer or buyer’s agent prior to the signing by the buyer of a binding contract of sale.” A copy “containing the signatures of both seller and buyer” is attached to the contract. The form states that it covers conditions “KNOWN TO THE SELLER”; it is not a warranty and not a substitute for the buyer’s inspections. Under § 462(3), nothing in the article requires a seller “to undertake or provide for any investigation or inspection” of the property “or to check any public records.”

The flood questions. The form now asks, among other things, whether the property is in a FEMA-designated floodplain, whether federal law requires flood insurance, whether federal flood-disaster assistance was received, whether there is flood insurance or a FEMA elevation certificate (copies to be attached), and whether you ever filed a flood-damage claim. Gather those records early.

The septic paragraph. Chapter 353 of the Laws of 2024, effective July 1, 2025, amended the form’s septic item to add a statement pointing to New York State Department of Health information on septic system operation and maintenance. According to a New York State Association of REALTORS® legal update, the amended form must be used beginning July 1, 2025.

Liability. Under § 465, a seller who provides the statement “shall be liable only for a willful failure to perform the requirements of this article,” and for a willful failure the measure is the buyer’s actual damages. The same section says the article does not limit “any existing legal cause of action or remedy at law, in statute or in equity,” so other claims may still be possible depending on the facts. Ask your attorney before answering anything you are unsure of.

Who is exempt. The statute covers “residential real property” improved by a one- to four-family dwelling and expressly excludes condominium units and cooperative apartments (§ 461). Section 463 also lists 14 exempt transfers, including court-ordered transfers, foreclosure and sheriff’s sales, transfers by an estate or trust fiduciary, transfers to a spouse or to persons in the transferor’s lineal consanguinity (such as children, grandchildren, or parents), and sales of newly constructed property that has never been lived in. For more detail, see New York property condition disclosure: what sellers must provide.

The Buyer’s Mortgage and Inspections

Most financed contracts include a mortgage contingency, under which, as the State Bar puts it, “the buyer’s obligations to close are conditioned on the buyer’s obtaining a mortgage loan commitment.” As the seller, you want clear deadlines and a clear answer on what happens to the down payment if the buyer cannot get a commitment in time. Prompt access for inspections and the appraisal often keeps the deal on schedule.

Title Issues Sellers Should Expect

The buyer’s title company will search the property’s records and report what it finds, such as your existing mortgage, home equity lines, judgments, liens, open permits, and recorded easements. Your attorney orders payoff letters, arranges for liens to be satisfied from the proceeds, and works to resolve the other objections so the buyer can obtain title insurance.

Sellers under financial pressure. If your mortgage is in default or in foreclosure and someone offers to buy your home quickly, New York’s Home Equity Theft Prevention Act (Real Property Law § 265-a) may apply. Under that law, the homeowner, as the “equity seller,” may cancel a covered contract “until midnight of the fourteenth business day following the day” it is signed. Speak with an attorney before signing anything in that situation, and see our article on deed theft in New York.

Transfer Taxes on the Seller’s Side

The figures below are as published by the New York State Department of Taxation and Finance and the New York City Department of Finance as of October 2026. Rausa Russo Law does not provide tax advice; for income-tax questions about your sale, we can coordinate with your tax adviser.

The tax department’s summary is direct: “The base tax and additional base tax are paid by the grantor (seller).” For New York City sales, the Department of Finance states that “you must pay the RPTT tax and file the return within thirty days after the transfer of the property.” Because the seller must pay the mansion tax if the buyer fails to pay it, and the tax then becomes the joint and several liability of both parties, a seller has a stake in confirming that the buyer actually pays it at closing. See New York closing costs: transfer tax, mansion tax, and mortgage recording tax.

Selling investment property? If the property was held for business or investment, a like-kind exchange under Internal Revenue Code § 1031 may allow you to defer gain, but the deadlines are strict: replacement property must be identified within 45 days after you transfer the relinquished property and received by the earlier of 180 days or your return’s due date (including extensions). Property held primarily for sale does not qualify. See 1031 exchange deadlines for New York investors; talk with your tax adviser before signing.

Selling a Co-op or Condo

Co-ops. When you sell a co-op, you are transferring shares and a proprietary lease, and the buyer typically needs board approval under the building’s documents. Courts generally defer to boards that act, in the words of the business judgment rule, “for the purposes of the cooperative, within the scope of its authority and in good faith” (Levandusky, as restated in 40 W. 67th St. Corp. v. Pullman). In New York City, Local Law 58 of 2026 requires covered boards to acknowledge receipt of application materials within 15 days and to state consent or denial within 45 days after the application is complete, with limited extensions; HPD enforces it with civil penalties ranging from $1,000 for a first violation to $2,000 for later violations. The law took effect July 28, 2026, applies to applications made on or after that date, and does not cover buildings with fewer than 10 dwelling units, housing development fund companies (HDFCs), or co-ops whose share sales require a governmental housing agency’s approval. If a board does not acknowledge an application within 15 days, the application is deemed complete; a board may extend the 45-day decision deadline once, by up to 14 days, on notice; and, if the board has adopted a written summer recess notice, the 15-day acknowledgment deadline is paused during the July–August recess, and the 45-day decision deadline is paused if it would otherwise end during the recess. In Westchester County, the Human Rights Commission explains that boards must acknowledge receipt of an application (or identify what is missing) within 15 days, decide within 60 days after a complete application, and state “the reason for the rejection” in any rejection notice. Ask the managing agent early what the building’s application package requires.

Condos. A condo unit and its common interest “shall for all purposes constitute real property” (RPL § 339-g), so you convey it by deed. Your building’s declaration and by-laws may contain a right of first refusal or other sale procedures; read them before you sign a contract.

No PCDS. The Property Condition Disclosure Act does not apply to condo units or co-op apartments (RPL § 461). Resales by individual owners are also, in the Attorney General’s words, “not regulated by the Attorney General.” See buying a co-op in New York: board approval for the buyer’s side of the process.

Fair Housing Applies to Sellers

Under Executive Law § 296(5)(a), it is an unlawful discriminatory practice for an owner to discriminate in the sale of housing because of protected characteristics, including “race, creed, color, national origin, citizenship or immigration status, sexual orientation, gender identity or expression, military status, sex, age, disability, marital status, status as a victim of domestic violence, lawful source of income or familial status.” Lawful source of income is defined broadly in § 292(36) to include child support, Social Security, and public or housing assistance. Evaluate offers on price and terms.

Closing Day and After

At closing, you sign the deed and transfer tax returns, the buyer pays the balance, your mortgage and any liens are paid off, and the net proceeds are disbursed. Proceeds are a wire-fraud target too; the FTC warns of emails claiming “there’s been a last-minute change.” We recommend treating any emailed change to payment instructions as unverified until you confirm it by phone at a number you already have. If money goes astray, the FBI advises: “Immediately, contact your financial institution and request a recall of the funds,” and to file a complaint at www.ic3.gov. It is a sensible precaution to report the transfer to your bank as fraudulent right away by phone and then follow up in writing to create a record. Which laws apply to a stolen wire can depend on how the payment was made; federal courts are divided on some of these questions, and the issue is on appeal. Banks and other parties may have their own responsibilities, and some deadlines to act are short. See our guide to drained bank accounts and unauthorized transfers and our article on real estate closing wire fraud.

Buying your next home? Register it for the STAR credit if it will be your primary residence; see our buying guide.

How a Flat-Fee Quote Works

Flat-fee representation is available for many residential closings. Request a quote; the quote and our engagement letter describe what the fee covers. Third-party costs (such as transfer taxes, recording fees, and payoffs of your mortgage and any liens) are separate. A quote is not an engagement; representation begins only under a signed engagement letter. Start on our quote request page or learn more about the Real Estate & Closings practice group.