What NJ’s New Transfer & Mansion Tax Changes Mean for You

Written by Leor Hemo, President & Chief Executive at Vantage Commercial. 

In a move that will significantly impact real estate transactions across New Jersey, Governor Phil Murphy has approved sweeping updates to the state’s real estate transfer fee, controlling interest transfer tax, and mansion tax as part of the new budget.

These changes are more than just a rate increase—they’re a fundamental shift in who pays these taxes and how much they pay. As the CEO of Vantage Commercial, I want to ensure our clients, partners, and property owners understand exactly what this means, and how to prepare.

What’s Changing?

Effective immediately, the updated legislation now places the burden of the real estate transfer fee and mansion tax on the seller—a major shift from the previous structure where the buyer typically paid these costs.

Here’s how the new tax rates break down:

• 1% for transfers over $1M–$2M

• 2% for transfers over $2M–$2.5M

• 2.5% for transfers over $2.5M–$3M

• 3% for transfers over $3M–$3.5M

• 3.5% for transfers above $3.5M

This applies to residential, commercial, farm, and cooperative units exceeding $2 million in value, as well as to controlling interest transfers of commercial real estate entities valued over $1 million.

Why This Matters

For sellers of high-value commercial properties, this could mean a six-figure difference at the closing table. Whether you’re actively listing a property or considering a future sale, understanding how these new tax brackets affect your bottom line is essential.

More importantly, timing matters. If you’re under contract before July 10, 2025, and your deed is recorded on or before November 15, 2025, the new tax rates may not apply. Miss that recording window, and the higher rate—and seller liability—kicks in.

Key Takeaways for Sellers and Investors:

• Sellers, not buyers, are now responsible for these transfer and mansion taxes.

• If you’re in the middle of a deal or preparing to list, timing is everything.

• These changes affect both direct property sales and controlling interest transactions.

How Our Team Can Help

At Vantage Commercial, we’re already guiding our clients through the nuances of this new tax structure. Whether you’re looking to sell before the deadline or want to understand the long-term impact on your portfolio strategy, our team is here to provide clarity and support.

If you’re navigating a transaction over $1M, let’s talk. Our goal is to help you avoid surprises at the settlement table—and structure your deals with confidence.