Anyone who’s been shopping for a new home in Manhattan or Brooklyn will have noticed that most of the properties for sale are co-ops and condos. While these types of properties may have a lot of benefits, they also have a few downsides such as needing board approval for renovations and restrictions on noise levels. However, there is a third and less common sector of residential properties in NYC – townhouses.

Gardens, historical details, privacy, and numerous bedrooms and bathrooms are just some of the benefits of townhouse living. Space and flexibility they offer truly make them dream homes for many buyers. However, they also come with a whole new set of responsibilities. You’ll be responsible for salting your icy stoop, taking the garbage to the curb and maintaining your boiler and HVAC. But if it’s privacy and independent living that you’re after they’re probably the best choice in the whole city. This complete guide takes you through every step of the process of buying a townhouse in NYC.

What are the Benefits and Considerations of Townhouse NYC Living?

One of the most attractive benefits of townhouse living is that there is no co-op or condo board approval process to go through in the purchase or sale. Not only does this mean less hassle and delays in closing, but it also means no house rules. Coupled with that, most townhouses have backyards, decks or terraces and beautiful tree-lined streets.

Not forgetting the original and historical details as well that you can find in each one. Most, but not all, date to the 19th and early 20th century. Stained glass, original woodwork, and decorative fireplaces are just some of the unique details that buyers go crazy for.

There’s also the low carrying costs. By owning a townhouse, you can save big by avoiding monthly co-op maintenance and condo common charges to use the amenities found in many New York buildings. Along with that, real estate taxes are typically lower on townhouses.

Like everything though, there are a few downsides to consider. The cost of maintaining the townhouse falls completely on your shoulders. Unlike in a co-op, there’s no way to share costs with other owners. Maintaining the home and all its utilities are entirely your responsibility. If you’re planning to sublet by splitting it into multiple units, you may require a change in the Certificate of Occupancy. Something which you should consult with a real estate attorney before doing so.

Searching for a Townhouse

Before you can begin the search, there are a few things you need to organize. The first thing to start with is deciding which part of town you want to live in. Begin by seeing as many open houses as you can to familiarize yourself with what’s out there. Secondly, find a good buyer’s agent that specializes in townhouses. Once you have a good understanding of your needs, they can provide recommendations and start making phone calls.

Also, educate yourself about townhouses and think about the costs of possible renovations. Learn the details about rent-stabilized and rent-controlled tenancies. Townhouses with multiple tenants are cheaper but come with less privacy so decide which one suits you best. You’ll also need to have your finances in order. The closing costs on a townhouse are typically 20-40% of the purchase price.

Once you’ve found a place, you like you might be tempted to move straight to making a purchase offer. Instead, hold out until you’ve had the property inspected by a licensed home inspector. This is usually not an issue with co-ops or condos, but with townhouses, it should be mandatory. Have them check for any structural issues, plumbing or electrical issues. That way, you can avoid any nasty surprises that could be lurking after you’ve bought the property. If you find any issues, you might be able to negotiate a reduced price or ask that repairs be done before you sign a purchase contract.

Your buyer’s agent will conduct negotiations on your behalf and work to get the best offer in your favor. If you’re happy with everything, your buyer’s agent will help you draft a purchase offer. There may be a bit of back and forth as counter offers are made but once you’ve reached an agreement you can move on to the next step. Once an offer is accepted your broker will introduce you to a real estate attorney, who will then iron out the final details and compose a purchase contract. Remember that nothing is binding until both parties have signed on the dotted line.

Reviewing the Contract

Once an agreement is reached the seller’s attorney will draw up the deal sheet, which will be forwarded to the seller’s attorney who will, in turn, draft the contract for the buyer’s attorney to review. Typically, on signing the contract, you will be required to write a check for 10% of the purchase price. The cash from this will be kept in an escrow account of the seller’s attorney until the whole deal is closed. At this point, you are now “in-contract” with neither side able to walk away without legal consequences.

If you’re having the purchase financed now is the time to begin applying to banks for the mortgage loan. You’ll also need to arrange for homeowner’s insurance. If you’re taking out a loan, you won’t be able to close without it. If you’re an all-cash buyer, you will still need to clear title. You can usually close within a couple of weeks if you’re paying all cash.

The Closing

Once the lender is ready the buyer’s attorney will schedule a closing. Be sure to do a final walkthrough of the property to ensure it is still in the same condition you first saw it in. At closing, buyers, sellers, lender and both attorneys will gather in an office to sign the various documents that transfer ownership. The buyer will also write checks for such things as first mortgage payment, escrow payments, and closing costs.

Congratulations, you are now the owner of your very own NYC townhouse.


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