By Eric Berman, REALTOR® | The Eric Berman Team at Compass
TL;DR:
On Long Island, sellers pay several costs at closing — brokerage commission, NY State Transfer Tax of $4 per $1,000, real estate attorney fees, mortgage payoff, and prorated property taxes — all deducted from sale proceeds. Knowing these numbers before listing is what turns a sale price into a reliable net.
What Sellers Actually Pay at Closing
Most sellers focus on the sale price, but the number that matters is what's left after closing costs come out. On Long Island, those costs are predictable enough to estimate before a home ever hits the market, and a seller who runs them early avoids the unpleasant surprise of a smaller-than-expected check at the table.
The main line items are consistent from sale to sale: brokerage commission, NY State Transfer Tax, real estate attorney fees, any title-related and recording charges, prorated property taxes, and the payoff of any existing mortgage. Each comes out of proceeds at closing rather than out of pocket along the way, which is why an early estimate is so useful. For the bigger picture of how these costs fit into the final number, the overview of how to net the most from a sale puts them in context.
Commission Is the Largest Line Item
For most sellers, the brokerage commission is the single biggest closing cost. It's agreed to in the listing agreement up front, paid from the seller's proceeds at closing, and structured to compensate the agents involved in the sale. Commission structures vary by brokerage and by the specifics of the arrangement, and following the 2024 industry changes, the way buyer-side compensation is handled is more openly negotiated than it once was.
Because it's the biggest number, it's also the one sellers ask about most. What's worth understanding is that commission buys the marketing, pricing strategy, negotiation, and transaction management that often determine the final sale price — so the more useful question is usually about value delivered, not just the percentage. The breakdown of whether closing costs are negotiable digs into where there's room to move and where there isn't.
The NY State Transfer Tax
New York charges a transfer tax when ownership changes hands, and for most residential sales the seller pays it. The rate is $4 per every $1,000 of sale price — so a $1,000,000 sale carries a $4,000 state transfer tax. It's a fixed, formula-driven cost, which makes it one of the easiest line items to estimate in advance.
Worth keeping in view at the higher end: on sales of $1 million or more, the Mansion Tax of 1% also enters the transaction. That one is paid by the buyer rather than the seller, but it affects what buyers in that range can afford to offer, which is why sellers in Manhasset, Port Washington, Garden City, and Roslyn should factor it into pricing strategy. The overview of taxes when selling on Long Island covers the full tax picture.
Attorney Fees and the NY Process
New York is an attorney state, which means a real estate attorney — not a title company — handles the legal side of the sale. The seller's attorney drafts and negotiates the contract, reviews title and municipal documentation, prepares the closing paperwork, and attends the closing itself. This is a structural feature of selling in New York, not an optional add-on.
Attorney fees vary with the complexity of the transaction, but they're a known, quotable cost a seller can lock in before listing. Having an attorney engaged early also smooths the process once an offer is accepted, since contract turnaround in New York moves quickly and the seller's leverage is strongest at that stage.
Mortgage Payoff, Title Charges, and Tax Proration
If there's an existing mortgage, the lender is paid off at closing — remaining principal, accrued interest, and any administrative or recording fees — all calculated into the final closing statement. Title and recording charges are usually modest for sellers, since buyers typically carry the title insurance, though sellers may cover recording fees, document preparation, and a few title search adjustments.
Property taxes are prorated between buyer and seller based on the closing date. A seller who has prepaid taxes for the period past closing receives a credit from the buyer; if taxes are owed, that balance comes out of proceeds. None of these are large next to commission and transfer tax, but together they shape the final net — which is exactly why a net sheet before listing is worth the few minutes it takes to prepare.
FAQs
Q: Who pays closing costs when selling a home on Long Island?
A: The seller typically pays brokerage commission, the NY State Transfer Tax, their own real estate attorney fees, certain recording charges, and the mortgage payoff, with property taxes prorated to the closing date. These come out of sale proceeds at closing rather than out of pocket, so they directly reduce the seller's net.
Q: What is the New York State Transfer Tax?
A: New York charges $4 per $1,000 of the sale price, paid by the seller on most residential transactions — so a $1,000,000 sale carries a $4,000 transfer tax. On sales of $1 million or more, the buyer also pays a separate 1% Mansion Tax, which can affect affordability and offer strength at the top of the market.
Q: Are property taxes adjusted at closing?
A: Yes. Property taxes are prorated between buyer and seller based on the closing date. A seller who has prepaid taxes for the period after closing receives a credit from the buyer, while any unpaid balance is deducted from the seller's proceeds at the closing table.
Q: Do sellers pay for title insurance on Long Island?
A: Usually the buyer purchases title insurance, but sellers may be responsible for certain title-related costs such as recording fees, document preparation, and title search adjustments. These are typically modest compared with commission, transfer tax, and attorney fees, but they still belong on a complete net sheet.
Q: How can a seller estimate net proceeds before listing?
A: A net sheet outlines the expected commission, transfer tax, attorney fees, and mortgage payoff against the projected sale price, producing an estimated net before the home is ever listed. Preparing one early helps a seller plan the next purchase budget and set pricing strategy with a clear picture of what they'll actually keep.
Closing costs on Long Island aren't mysterious — they're a known set of numbers that can be estimated well before a home goes on the market. The sellers who plan for them, rather than meeting them for the first time at the closing table, are the ones who end up with no surprises and a net they can count on. For anyone wanting to see where their own numbers might land, a quiet look at current home values is a good first step, and putting together a net sheet together anytime is welcome too.
By Eric Berman, REALTOR® | The Eric Berman Team at Compass
Eric Berman | Long Island & Queens REALTOR® | Compass
1468 Northern Blvd, Manhasset, NY 11030
(917) 225-8596 | eric@ericbermanteam.com | theericbermanteam.com
