What is a “capital contribution fee” in NYC real estate?

November 13, 2018 by Georges Benoliel

What is a capital contribution fee?

I decided to write a quick blog post on this concept after we saw this new term emerging from New Construction jargon. Several buyers using NestApple asked us what exactly is a capital contribution fee, also called “HOA capital contribution fee”

A “capital contribution” is a one-time charge normally associated with the transfer of title on a property. It can be part of a condo or homeowners association. It is normally paid at settlement to the association and is usually deposited into the capital reserves to fund future maintenance items. This fee varies by building and can be paid by either the buyer or seller.

With NestApple, the good news is that your real estate cash back rebate will pay for this capital contribution fee as well as the rest of the closing costs!

In a new development, this fee is listed as closing costs for the buyer; it typically represents a few months’ worth of the apartment’s common charges. Some developers sometimes charge buyers two separate capital contribution fees.

1. The first one, usually a few months’ worth of common charges, is the “traditional” way the building builds up is capital reserve fund.
2. The second fee may be a per-unit charge to help fund and pay for the live-in super’s apartment.

Call your real estate listing agent in New York now to get your real estate cash back rebate.