The Secret's Out: What NYC Condo Buyers Need to Know About Secret Fees

Hidden fees for New York City apartmentsBuying a condominium in Manhattan involves one large fee and seemingly dozens of smaller ones. The many costs of closing on a NYC condo typically do involve a real estate agent's commission -- it has always been thus, and always will be -- but one less-than-welcome recent innovation to hit the New York real estate scene is currently getting some richly deserved scrutiny. As The Real Deal's Ken Harney reports, the Department of Housing and Urban Development is looking into the widespread and frankly dodgy practice of additional, ill-defined "admin" fees tacked on top of the commission on a condominium purchase."A U.S. District Court decision last year threw the industry into an uproar when a judge concluded that add-on fees violate federal law when there are no specific services performed to justify the extra cost to consumers," Harney writes. "Though the decision directly affected only an estimated 30,000 transactions by one brokerage firm based in Alabama, the National Association of Realtors and other industry groups urged brokers and agents to re-examine their approach to pricing." Here's reason 4,080 to work with a real estate agent you trust, but also another reason to know your rights as a condo buyer -- and read the New Construction Manhattan Buyer's Guide -- before you buy a Manhattan apartment. And of course if you notice a mystery fee of any sort or in any amount when it's time to close on your apartment, find out what it is. If it's a fee for a service that your agent didn't provide, it's a violation of the Real Estate Settlement Procedures Act, and it's illegal.

NYC Daily Real Estate Blog

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