8 Steps to Buying a House in New York

Jamie Ayers


Jamie Ayers

December 1st, 2022
Updated December 1st, 2022


8 Steps to Buying a House in New York

✍️ Editor's note: We strive to provide objective, independent advice. When you decide to use a product or service we link to, we may earn a commission. Learn more.

Now that the housing market is finally calming down after the pandemic[1], buyers are facing a new challenge: Soaring mortgage rates.[2]

In New York, the average 30-year fixed mortgage rate is 5.37% — up from 2021's historic lows. This raises the average monthly mortgage payment to $1,844 (assuming a 20% down payment at the median home value).

But buying a home in New York is still possible, even for first-time home buyers. Many markets are seeing frequent price drops and fewer offers, giving motivated buyers the upper hand in negotiating for the best price.

In this guide, you’ll learn how to buy a house in New York with confidence no matter what the market brings. Learn why you can trust our advice.

Whether you're actively house hunting or just starting to browse homes on Zillow, it's never too early to find a great local realtor to guide you on your search. An experienced agent can help you navigate a tricky housing market, explore your financial options, and negotiate the best deal possible.

Best of all, hiring a real estate agent comes at no extra cost to you — since the seller typically pays both their listing agent and your buyer's agent.

Ready to find a great local realtor, but not sure where to start? The best (and easiest!) option is to try a free agent matching service like Clever Real Estate. Answer a few simple questions about your home buying goals, and Clever will match you with hand-picked agents from Keller Williams, RE/MAX, and other top brokerages in your area. Find a top local agent and make your home buying dreams a reality today!

Step 1: Save for a down payment

🔑 Key takeaway:

Your down payment can be less than 20% of the purchase price — $82,372 for the typical home in New York — but you'll have to purchase mortgage insurance and pay more interest over the life of your loan.

Your down payment is the first part of your home's purchase price that you pay at closing. Your mortgage lender will pay the remaining balance.

Typically, mortgage lenders in New York want you to contribute 20% of the purchase price as a down payment. That would be $82,372 for a $411,861 home — the typical home value in New York.

However, you have options to lower your down payment amount.

Government backed loans, like VA and FHA loans, allow you to contribute 0% and 3.5% of your home's purchase price respectively. Even conventional loans allow for down payments as low as 3-5% (though the minimum varies by lender).

Mortgage type
Minimum down payment (%)
Down payment ($)
VA Loan
FHA Loan
Based on typical home values from Zillow (August 2022)

But making a down payment of less than 20% comes with some risks.

First, because you're borrowing more money, you'll have a higher monthly payment and pay more in interest over the life of your loan.

Down payment
Monthly payment
Total interest
Total Cost
Based on home values from Zillow (August 2022) and a 5.37% interest rate for a 30-year loan.

Second, you may have to purchase mortgage insurance.

Conventional loans require private mortgage insurance (PMI) until your loan balance reaches 80% of the purchase price. FHA loans, on the other hand, require a mortgage insurance premium (MIP) for the life of your loans.

Mortgage insurance costs around 1% of your mortgage balance annually. However, rates vary based on your down payment and credit score. Typically, your mortgage insurance payment is added to your mortgage payment each month.

VA loans don't charge mortgage insurance. Instead, you'll pay a VA loan funding fee at closing, which can range from 1.4% to 3.6% of the purchase price.

» READ MORE: Everything you need to know about low-income home loans

New York down payment assistance programs

There are numerous down payment assistance (DPA) programs available in New York for interested homebuyers. These programs can help low-income and first-time buyers afford a home through grants or second mortgages with deferred or forgiven payments.

Check out these DPA programs in New York to see if you qualify:


The State of New York Mortgage Agency (SONYMA) offers two DPA programs: the Down Payment Assistance Loan (DPAL) program and the DPAL PLUS program.

The DPAL program offers a loan of 3% of the purchase price (up to $15,000), and is forgivable after ten years. The DPAL PLUS option offers up to $30,000 for homebuyers earning less than 60% of the area median income.

To qualify for either program, the borrower must contribute at least 1% of the purchase price from their own funds.

HomeFirst DPA Program

The Neighborhood Housing Services of New York City offers its HomeFirst DPA Program to first-time homebuyers earning less than 80% of the area median income. The financial aid can provide up to $100,000 to pay for a single-family home, multi-family home, condo, or a cooperative in any of New York City's five boroughs.

Eligible participants must make a minimum down payment of 3% of the purchase price, complete a homebuyer education course, and live in the home for at least ten years.

U.S. Department of Housing and Urban Development

HUD’s list of alternative programs in New York can be found here.

Step 2: Find a great real estate agent in New York

🔑 Key takeaway:

Interview multiple agents to find one who knows your target neighborhoods, has experience in your price range, and communicates well.

Your real estate agent will be your main ally during the home buying process. Besides finding and showing you properties, your agent will help you make offers, negotiate contracts, and navigate the closing process. Plus, they can recommend other service providers like title companies and inspectors to help you buy your home in New York.

Don't rush into choosing an agent. Instead, take the time to research and interview multiple real estate agents who have experience in the neighborhoods you're interested in. You should pay attention to a realtor's:

  • Years of experience
  • Number of transactions in the last year (the more the better!)
  • Experience in your price range
  • Overall review score
  • Individual reviews and complaints

👋 Find the best realtors near you!

Finding a great real estate agent shouldn't be complicated. Let Clever Real Estate do the hard part and match you with experienced local realtors who are experts in your market.

Enter your zip code below to compare top agents from trusted brands like Keller Williams, Berkshire Hathaway, and Coldwell Banker, then choose the best fit for you. It's 100% free, and there's no obligation.

Step 3: Get preapproved for a mortgage

🔑 Key takeaway:

Once you're preapproved for a mortgage, it's imperative that your financial situation doesn't change. If your credit drops, it can derail the process and keep you from closing on your house.

Here are some easy ways to ensure your credit doesn't change after you receive your preapproval letter:

  • Avoid opening new credit accounts
  • Don't close any accounts that have been open for a long time
  • Make all of your credit card payments on time

» LEARN MORE: What factors do mortgage lenders consider?

A mortgage preapproval letter is an offer to lend you up to a certain amount of money to purchase a home. It shows sellers that you are a serious buyer who is financially qualified to make an offer on a home.

Most sellers in New York will require preapproval before showing you their home.

You don't have to decide on one lender right now. In fact, you should compare interest rates and preapproval amounts from several lenders to make sure you're getting the absolute best terms when you buy your New York home.

Step 4: Choose the right location

🔑 Key takeaway:

Search for neighborhoods where:

  • Home prices are within your price range
  • Home values are on the rise
  • The local amenities support your lifestyle

Currently, the typical home value in New York is $411,861, but don't worry if that doesn't perfectly match your budget. Home prices vary dramatically from city to city and even from neighborhood to neighborhood!

Also, look at past home value trends. This will give you an idea of how much your home's value could go up over the next few years.

To give you an idea of how appreciation could impact what your house is worth in the future, consider these examples from three neighborhoods in New York:

Home value appreciation in New York

Upper West Side
Washington Heights

Step 5: Start house hunting in New York

🔑 Key takeaway:

New York’s listing prices are climbing up, so expect houses in the area to be expensive. While there’s no shortage of listings, keep an open mind — especially if your budget is tight. Work with your agent and check out the listings they show you. While they might not be perfect, you may also be pleasantly surprised with what your agent can find.

Searching for homes in New York is the fun part of the home buying process! You'll get to look at a variety of homes and discover what you really want in a home.

Make a list of everything you want in a home and prioritize them. At the top of the list should be the items that are most important to you. This will help you separate your "must-haves" from your "nice-to-haves."

Your agent can help you understand if your wants are realistic for your budget and favorite neighborhoods or if you need to rethink what you're looking for.

Look at current housing inventory

The timing of your house hunt in New York can have a big impact on your number of options. For example, in New York, May has historically seen the most homes for sale. Searching in this season could give you more options and a greater likelihood of finding your dream home.

On the other hand, December gives you the fewest choices in New York. Historically, there are 51.6% fewer homes for sale than during New York's peak season.

Housing inventory in New York by season

New listings per month
Based on data from Realtor.com (October 2022)

Step 6: Make an offer

🔑 Key takeaway:

New York’s market is active, and listings in desirable neighborhoods around the metro area are highly sought after. With the fierce competition, put in a strong offer to entice the seller. As you move further from the cities, your chances of getting a great listing increase, so if you have a tight budget consider moving further out. Either way, talk with your agent about contingencies and concessions ahead of time so you can come up with a reasonable but competitive figure to put forward.

Once you find a New York house you love, it's time to make an offer. Your real estate agent will help you write a compelling offer that gives you the best shot of convincing the homeowner to sell to you.

Currently, in New York, homes stay on the market for 78 days before going under contract. However, every market goes through seasonal changes. During busier months, homes get snatched up more quickly than others.

Historically, New York homes sell fastest in July, where the average property is only on the market for 65 days. If your home search falls around this time, you should be prepared to move quickly and potentially make offers on several homes before yours is accepted.

On the other hand, if you buy in February, you have a bit more time to search. Homes typically stay on the market 25 days longer than New York's annual average.

Average time homes spend on market in New York

Annual average
78 days
103 days
101 days
80 days
70 days
66 days
65 days
64 days
68 days
76 days
78 days
83 days
94 days
Based on data from Realtor.com (October 2022)

» LEARN MORE: What should an offer include?

Step 7: Inspections and appraisals

Inspections and appraisals are an opportunity for you to better evaluate the home's condition and value before officially purchasing it. You may have an opportunity after this step to renegotiate the terms of your contract with the seller if something unexpected pops up.

🔑 Key takeaway:

  • Inspections: A licensed professional checks the house for any unseen, unexpected, or potential issues.
  • Appraisals: An appraiser hired by your lender examines the house to determine how much it's worth.

Home inspections in New York

Having your New York home inspected by a licensed inspector gives you peace of mind about the condition of the property before you commit thousands of dollars to purchase it.

Your inspector should check out the following parts of the property:

  • Roof
  • Foundation
  • Electrical system
  • HVAC system
  • Plumbing

If the home has a septic system, you should also pay for a septic inspection to make sure it doesn't have any problems that wouldn't be covered in a typical home inspection.

New York-specific inspections

New York’s disclosure laws require sellers to inform buyers of all known issues with a property, but a general home inspection may not reveal all of a home's problems. Homebuyers are strongly recommended to do their due diligence and get more specialized inspections done before closing.

Here are a few important tests you might want to consider:

  • Radon testing: If a seller hasn't conducted a radon test in the past year, it's best to have one done before closing. Radon is dangerous at elevated levels and can cause long-lasting lung damage. Find information about where to obtain a radon test kit on the New York State Department of Health website.
  • Termite inspection: Only eighteen counties in New York require pest inspections before closing on a property, but it's smart to get one completed no matter what. Termites and other unwanted pests can cause structural damage and pose health risks if infestations aren't caught early.


Appraisals determine the value of the property. If you're using a mortgage to buy your new home, your lender will order an appraisal to make sure the home is worth the money that it's loaning you.

» LEARN: 3 options for buyers after a low appraisal

Step 8: Close on your new home!

🔑 Key takeaway:

Before you close on your new home, you and your agent will do a final walkthrough of the property to ensure that it's still in the expected condition.

To close on your New York home, you'll need to complete all the required paperwork and settle your closing costs at the title company.

On closing day, you can expect to spend about an hour reviewing and signing several legal documents, including:

  • Your final loan application
  • The deed
  • The mortgage promissory note
  • The disclosure statements

Make sure to read each form carefully before signing. If there's an error or you don't fully understand something, consult with your agent.

Once the paperwork is complete, you'll need to pay your closing costs. The title company can make this easier for you by distributing the payments you owe to the correct recipients.

To remember everything you're paying for, you can think of your closing costs as four distinct categories:

  • Lender fees: Fees paid to your mortgage lender for their services. These costs will cover the origination and underwriting fees, as well as appraisal and survey fees.
  • Title and escrow charges: Fees paid to the title company for conducting the closing process and performing the title search and documentation.
  • Prepaid costs: Predictable costs of homeownership that must be paid up front. Lenders often require new homeowners to pay for specific expenses in advance, such as property taxes and homeowners insurance.
  • Other closing costs: Miscellaneous expenses that vary from buyer to buyer. These costs can include natural disaster certification fees, pest inspection fees, or real estate attorney fees.

Buyers in New York typically pay 3–5% of the purchase price in closing costs. For a $411,900 home — the typical home value in New York — that's between $12,357 and $20,595!

⚡Make your home-buying dreams a reality!

Ready to make your home-buying dreams a reality? The first step is to find a top local realtor who's an expert negotiator with proven experience in your market.

Enter your zip code below to compare the best agents from trusted brands like Keller Williams, Berkshire Hathaway, and Coldwell Banker, then choose the best fit for you. It's 100% free and there's no obligation.

Frequently asked questions

New York does not require you to hire a real estate attorney to buy a home. However, depending on your circumstances, you might consider hiring one anyways. If you do, treat the process similarly to hiring an agent. Interview multiple attorneys and proceed with the one that best meets your needs.

  1. Save for down payment
  2. Get pre-approved for a mortgage
  3. Choose your preferred New York neighborhoods
  4. Partner with the right real estate agent in New York
  5. Go house hunting
  6. Make a strong offer
  7. Inspections and appraisals
  8. Do a final walkthrough and close

Yes, but they're not just for first-time buyers. The State of New York Mortgage Agency (SONYMA) offers down payment assistance to all eligible borrowers. The financial assistance is provided as a 0% interest loan of up to $15,000. The loan is forgiven if the buyer uses the property as their primary residence for 10 years.

Before you can apply for down payment assistance, you must be approved for a SONYMA first mortgage. You will also be required to contribute at least 1% of the home's purchase price for the down payment.

» READ: What are the top first-time homebuyer programs?

Why trust us?

Clever Real Estate is a free agent-matching service that has helped more than 82,000 people buy and sell homes. We partner with over 2,700 top-performing agents nationwide at national brokers including Keller Williams, RE/MAX, Century 21, and more. We also help buyers save thousands with cash back after closing — no strings attached.

We’ve earned buyers’ trust with a rating of 4.9 out of 5 starts on Trustpilot and over 1,800 customer reviews.

Our team of industry-leading researchers are committed to making homeownership more accessible by educating buyers through guides like this one. We've spent thousands of hours analyzing publicly available data, surveying consumers, and interviewing industry experts. Our research has been featured in The New York Times, Business Insider, Inman, Housing Wire, and many more.

Learn more about Clever.


Federal Reserve. "Housing Market Tightness During COVID-19: Increased Demand or Reduced Supply?." Accessed October 11, 2022. Updated July 08, 2021.


Consumer Protection Financial Bureau. "The Fed is raising interest rates. What does that mean for borrowers and savers?." Accessed October 11, 2022. Updated March 17, 2022.

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