What is a “capital contribution fee” in NYC real estate?
Go Back To Previous Page
I decided to write a quick blog post on this concept after we saw this new term emerging from New Construction jargon. In fact, several buyers using NestApple asked us what exactly a capital contribution fee in NYC means. Sometimes, people also call this “capital contribution fee” an “HOA capital contribution fee”.
What exactly the capital contribution fee in NYC means?
A “capital contribution” remains a one-time charge normally associated with the transfer of title on a property. It remains part of a condo or homeowners association. The buyer or the seller normally pays the capital contribution fee at settlement to the association. Therefore, this contribution gets usually deposited into the capital reserves to fund future maintenance items. In fact, this fee varies by building and either the buyer or seller can pay for it.
However, with NestApple, your real estate cash back rebate can pay for this capital contribution fee as well as the rest of the closing costs!
In a new development, sponsors list this fee 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.
- The first one, usually a few months’ worth of common charges, represents the “traditional” way the building builds up its capital reserve fund.
- 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.
Georges has been working in Wall Street for the last 16 years trading derivatives with hedge funds. He has been an active real estate investor for over a decade. Georges graduated from HEC Business School in Paris and holds a master in Finance from ESADE Barcelona.
