What Foreign Buyers Should Know
Before Buying a New York City Condo
Yes. Foreign nationals can generally purchase condominiums in New York City without being U.S. citizens or residents. For many international purchasers, a condominium is also considerably more practical than a cooperative apartment.
A New York condo may be purchased as an investment, a pied-à-terre, a residence for a child or other family member, or a full- or part-time home. The purchase itself is usually straightforward. The issues surrounding the purchase — financing, ownership structure, taxation, use of the property and completing the transaction from abroad — deserve more careful attention.
Why Condos Are Often Better Suited to Foreign Buyers
New York City cooperative apartments generally require board approval and extensive financial disclosure and may impose restrictions on pied-à-terre ownership, subletting and other uses. Condominiums generally provide greater flexibility. A condo purchaser owns the individual apartment as real property, subject to the condominium’s declaration, bylaws and rules. For that reason, condos are often the preferred choice for international buyers, investors and purchasers acquiring a residence for a student or family member. or investment.
Can You Buy Without Traveling to New York?
In many cases, yes. An international purchaser can begin the search from abroad, review properties remotely, participate in live video tours and communicate electronically with the developer, buyer’s representative, attorney, lender and other advisers. Depending upon the transaction and the requirements of the parties involved, much of the purchase process can be handled remotely.
Can a Foreign Buyer Obtain Financing?
Foreign-national financing is available from some U.S. lenders, although requirements frequently differ from those applicable to U.S. residents. A lender may require a larger down payment, additional documentation of foreign income and assets, reserves, and other evidence of financial capacity. Some international purchasers instead choose to buy for cash. The appropriate approach depends upon the purchaser’s circumstances and the particular property.
How Should a Foreign Buyer Take Title?
A condominium may potentially be owned individually or through an entity or trust, but the method of ownership can have important U.S. income, estate, gift and succession consequences. This decision should therefore be considered before the purchase is completed, in consultation with appropriate U.S. tax and estate advisers and, where relevant, advisers in the purchaser’s home country. Eschewal does not provide tax or estate-planning advice, but we can coordinate the real-estate transaction with the purchaser’s professional advisers.
What Taxes Should an International Buyer Consider?
Foreign ownership of U.S. real estate can raise issues that do not arise in the same way for U.S. citizens and residents. Depending upon the circumstances, those may include taxation of rental income, estate-tax exposure, capital-gains taxation upon sale and withholding requirements. The consequences depend heavily upon the purchaser’s residence, ownership structure, intended use of the property and applicable tax treaties. International purchasers should obtain appropriate tax advice before completing the acquisition.
Do You Need Your Own Buyer’s Representative?
A new-development sales office represents the developer. Eschewal New York represents the purchaser. We help international buyers identify and compare new developments, evaluate pricing and value, communicate and negotiate with developer sales teams, and coordinate the purchase process with the buyer’s attorney, accountant, lender and other advisers.
Because our brokerage fee on qualifying new-development transactions is generally paid by the developer, Eschewal is also able to return a substantial portion of that fee to qualifying purchasers.
If you are considering contacting a developer directly, please review our Availabilities page first. Your ability to use Eschewal as your buyer’s representative — and to receive the applicable rebate — can depend upon when the relationship with the developer is established.