How Much Are Real Estate Attorney Fees NYC?
We’ll demystify this topic in the following video.
I’m Nick at Hauseit.
Visit our website www.hauseit.com to save money when buying or selling real estate in
NYC.
So let’s get started!
The average real estate attorney fee for a purchase or sale transaction in NYC is $2,000
to $3,000.
Lawyer fees can be as high as $5,000 for a more complex transaction and new developments
or if you’re working directly with a highly experienced attorney, such as a named partner.
There are also light-touch, discount lawyers available who charge flat fees as low as $800.
In order to make such a low price financially viable, discount attorneys typically outsource
most of the actual work to lower-cost paralegals and support staff.
So like with anything else in life, you get what you pay for, and always be sure to ask
who you’ll actually be working with on a day-to-day basis during the course of your
transaction.
It’s also important to keep in mind that rates are higher for real estate lawyers based
in Manhattan and the city compared to attorneys based in lower cost locations such as Long
Island or the Hudson Valley.
We strongly encourage you to work with an attorney that specializes in real estate deals
in New York City as opposed to a lawyer who dabbles in a variety of fields such as criminal
law and divorce.
An attorney who is unfamiliar with NYC real estate may not be aware of the norms in a
contract or the expected timeline for completing buyer due diligence and contract negotiation.
Are Real Estate Attorney Fees Charged Hourly?
No.
Real estate attorney fees are typically structured as a flat fee per completed transaction.
You should be careful of any lawyer asking for hourly pay for a real estate deal as that’s
a sure sign that the lawyer does not specialize in real estate transactions.
This will sometimes occur when buyers or sellers insist on using their family lawyer, someone
who has worked with their family on a variety of issues from pre-nuptial agreements to incorporating
a business.
Such a lawyer who claims to do a bit of everything will usually not have much experience in real
estate transactions.
Do You Pay Real Estate Lawyer Fees Upfront?
Real estate attorney fees are typically taken at closing and will be part of the closing
costs mentioned in your lawyer’s closing statement.
Some lawyers may negotiate for half or some other portion of the fee to be paid upfront,
with the remainder to be paid at closing.
Some lawyers may ask for an engagement letter to be signed outlining the terms of such an
agreement as this.
Real Estate Lawyer Fees for Complex Sales
Real estate attorney fees can be higher for more complex transactions that will simply
take more of the lawyer’s time.
For example, real estate lawyer fees could be higher for a complicated estate sale with
heirs that are hard to track down and a power of attorney involved.
Or the real estate attorney fees could be higher for a purchase involving a foreign
buyer and a convoluted corporate structure.
Real Estate Attorney Fees for New Developments
Real estate lawyer fees can often be doubled when buying a new construction home in NYC.
That’s because developers typically expect the buyer to pick up some of their closing
costs such as NYC and NY State transfer taxes and the sponsor’s attorney fees.
As a result, a buyer of a new construction condo or coop may end up paying for both their
own attorney fees plus the seller’s attorney fees!
Unfortunately for buyers of new development condos and coops, the rate charged by the
sponsor’s attorney is decided by the sponsor.
The rates charged by sponsor’s attorneys have been inflating quite a bit as of late,
and it’s not uncommon to see $3,000 to even $5,000 charged by
the sponsor’s attorney.