Buying in New York vs back home: co-op boards, mansion tax and the mortgage tax nobody mentions

In New York, whether you buy a co-op or a condo can swing your closing taxes by tens of thousands of dollars, and the board may still say no.

The short version

• Any Australian can buy a New York condo. A co-op is different: you're buying shares, and the building's board decides whether to let you in.
• The single biggest cost difference: NSW transfer duty on A$1 million is about A$39,200 [8]. On a US$700,000 New York apartment the buyer pays no transfer tax on a typical resale, but a mortgage on a condo attracts mortgage recording tax of about 2.2% of the loan [3].
• From US$1 million the buyer pays a 1% "mansion tax", with extra rates from US$2 million in the city [2].
• Lenders follow the same national rules as elsewhere in the US. E-3 holders can borrow; co-op boards often want a bigger deposit than the bank does.
• Selling as a non-resident brings FIRPTA withholding of 15% and an up-front New York State estimated tax of 10.9% of the gain [5][7].

Can an Australian buy in New York?

Yes. Neither the US nor New York State restricts Australians buying homes. The questions in New York are about the building, not your passport.

Condos

You own your apartment outright as real property, with a share of the common areas. Condo boards usually have only a right of first refusal, which is rarely used. Condos are the easier route for anyone with foreign income, a short US work history or plans to rent the place out later.

Co-ops

Much of Manhattan's older housing stock, from Upper West Side pre-war buildings to Brooklyn Heights walk-ups, is co-op. You buy shares in the corporation that owns the building and get a proprietary lease. The board reviews your finances, often in detail, and can reject you without giving a reason. Many boards set their own minimum deposit and post-closing cash reserves, cap or ban subletting, and look harder at buyers whose income or assets sit overseas.

Co-ops tend to be cheaper per square foot than comparable condos. That discount is the price of the board.

Other passports

A UK, Irish or Italian passport changes nothing here. A US green card or citizenship helps with the loan and tax, not the right to buy.

Upfront costs side by side

Rates as at November 2026. US dollars converted at the RBA rate of US$0.7014 per Australian dollar on 5 November 2026 (US$1 is about A$1.43).

The mortgage recording tax is the surprise for most Australians. It's charged on the loan, not the price, so a bigger deposit cuts it. Your attorney will confirm what share falls on you.

Getting a loan

In New York

The national rules apply. Fannie Mae accepts lawful non-permanent residents on the same terms as citizens, leaving lenders to check your status [6]. With an E-3 visa, a US job, a Social Security number and a credit file, a conventional loan is realistic. Building a US credit history takes time, so start early.

Co-ops add a second gate. The bank might lend 80% or more, but the board's own rules can demand 20%, 25% or more in cash, plus a year or two of maintenance payments in the bank after closing. Ask for the building's requirements before you fall for the view.

If you're buying from outside the US, expect "foreign national" loans with larger deposits and higher rates, and a co-op may be off the table entirely.

Back home

An Australian lender treats your US salary as foreign income, typically counting only part of it, capping the LVR below what local borrowers get and limiting you to a smaller group of lenders. As an Australian citizen buying in your own name, you don't need FIRB approval and NSW charges no foreign surcharge [9].

Holding costs

Most E-3 holders become US tax residents and are taxed on worldwide income, including rent from an Australian property. If you're also still an Australian tax resident, Australia taxes your worldwide income too, New York rent included. The tax treaty and foreign tax credits handle most of the overlap.

Selling and tax

New York

A main home owned and lived in for two of the last five years can shelter up to US$250,000 of gain from federal tax, or US$500,000 for a married couple filing jointly. New York State and City then tax remaining gains as income.

If you've moved back to Australia before selling, plan for two up-front payments:

1. FIRPTA. The buyer generally withholds 15% of the price when the seller is a foreign person [7].
2. New York State estimated tax. Non-resident sellers file Form IT-2663 and pay estimated tax of 10.9% of the gain when the deed is recorded (2026 form) [5].

Both are credits against your final tax, so file promptly to get back what you overpaid. Some co-ops also charge a "flip tax" on sale, set in the building's own rules.

Australia

Sell an Australian property while a foreign resident and you generally lose the main residence exemption, even for the years you lived there, unless the narrow life events test applies. The buyer must withhold 15% of the price on every Australian sale since 1 January 2025 unless you provide an ATO clearance certificate, which foreign residents can't get [10]. The May 2026 federal Budget also proposed replacing the 50% CGT discount with indexation and a 30% minimum tax for gains from 1 July 2027, pending legislation.

Currency risk

A US dollar home on a US dollar salary is matched. Move home and the exchange rate on sale day decides your result in Australian dollars.

A worked example

Illustration only. One budget, two places: a US$700,000 one-bedroom in New York (about A$998,000 at the 5 November 2026 RBA rate) against a A$1,000,000 NSW home. We assume an 80% loan of US$560,000 where there's a loan. Attorney, title, agent and bank fees are left out.

The sums: city transfer tax of 1.425% on US$700,000 is US$9,975 and the 0.4% state tax is US$2,800. Mortgage recording tax at 2.175% on US$560,000 is US$12,180. In NSW, A$11,602 plus 4.5% of A$613,000.

Push the price to US$1.2 million and the mansion tax alone adds US$12,000.

Which suits whom

• Co-op or condo. A co-op saves on tax at closing and often on price, but it limits who can buy, whether you can rent it out and how easily you can sell to a foreign buyer later.
• How long you'll stay. Closing costs are lower than Sydney's on a typical resale, but monthly charges are high. Run the numbers on rent versus owning for your likely stay.
• Whether you'll rent it out. If the plan is to keep it when you move home, a condo is usually the only practical choice.
• Whether you're moving back. Selling from Australia means FIRPTA, IT-2663 and US tax returns. Keeping an Australian home while you live in New York has its own rental and tax rules.
• Estate planning. US estate tax is much tougher on non-resident non-citizens than on citizens. Take advice in both countries.

Want to know how other Australians got through a co-op board interview? Join Cooee United States, our Facebook group for Australians in the US, at /join/.

Sources

1. Real Property Transfer Tax (RPTT) – NYC Department of Finance
2. Real estate transfer tax – New York State Department of Taxation and Finance
3. Statistical profile of the NYC mortgage recording tax 2024 – NYC Department of Finance
4. Property tax rates – NYC Department of Finance
5. Form IT-2663 (2026): nonresident real property estimated income tax – New York State Department of Taxation and Finance
6. B2-2-02: Non-U.S. citizen borrower eligibility requirements – Fannie Mae Selling Guide
7. FIRPTA withholding – Internal Revenue Service
8. How to calculate transfer duty – Revenue NSW
9. Surcharge purchaser duty for individuals – Revenue NSW
10. Foreign resident capital gains withholding overview – Australian Taxation Office

Keep reading

• Building a US credit history from scratch
• Renting in New York as an Australian
• Deposit and LVR as an expat borrower: how much you need
• Are you still an Australian tax resident once you move?