Owning real estate alone in New York means one person holds the title, without co-owners. This is common for investors, single individuals, and those who inherit property. While offering full control, sole ownership has specific legal and financial aspects different from shared ownership.
Understanding sole ownership is helpful if you’re looking to buy, manage, or pass on property by yourself, as it impacts decision-making and long-term planning.
Statutory Basis for Sole Real Property Ownership
In New York, an individual’s right to own real property independently is a well-established legal principle. This arrangement, known as ownership in severalty, means the title is held by one person or entity. While New York Real Property Law defines various estates in land, the concept of sole ownership is fundamental, allowing a legally competent individual to acquire, hold, and dispose of property in their own name.1NYSenate.gov. New York Consolidated Laws, Real Property Law This simplifies property transfer and management.
Rights and Responsibilities of Single Ownership
As the sole owner of real property in New York, you have full control over its use and enjoyment. This means you can make decisions about the property without needing anyone else’s approval.
Your rights include occupying and using the property, excluding others from it, and making alterations or improvements, as long as you follow local zoning and building codes. You can also earn income from the property, such as by renting it out.
With these rights come responsibilities. You must maintain the property in a safe and habitable condition. This includes making necessary repairs and ensuring essential services are working.
Property owners must also follow all state and local laws. This involves complying with building codes, health codes, and safety regulations, like installing smoke detectors and clearing snow from sidewalks as required by local rules.2NYS Department of Health. Amanda’s Law: Carbon Monoxide Detector Requirements Not meeting these responsibilities can result in fines or legal issues.
Liability Concerns for Individual Owners
Sole ownership in New York means that legal and financial risks fall directly on you as the individual owner. Liabilities from the property can affect your personal assets.
A common risk involves injuries on your property. Owners must keep their property reasonably safe. If someone is injured due to a hazard you knew about (or should have known about) and didn’t fix, you could be sued. For example, if a visitor slips on an icy walkway you didn’t clear, you could be held liable.
Financial liabilities are also your sole responsibility. This includes mortgage payments; defaulting can lead to foreclosure. Unpaid property taxes can result in liens and foreclosure. You are also bound by contracts, like those with contractors, and disputes can lead to judgments against you.
Owners may also face liability for certain environmental conditions. Federal and state laws can impose responsibility for hazardous substance cleanup costs, even if the current owner did not cause the contamination.3Legal Information Institute. 42 U.S. Code Chapter 103 – Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) Environmental assessments before purchasing are advisable.
Transfers of Title and Deeds
When a sole owner in New York transfers property, a deed is used. This written document conveys the owner’s (grantor’s) title to the buyer (grantee). For a deed to be valid in New York, it must:
- Be in writing.
- Clearly identify the grantor and grantee.
- State the intent to transfer.
- Provide an accurate legal description of the property.
- Be from a grantor with legal capacity to transfer.
- Be signed by the grantor, usually acknowledged before a notary public.
After the deed is signed and notarized, it must be delivered to and accepted by the grantee. Recording the deed with the county clerk (or city register in NYC) where the property is located gives public notice of the ownership change and protects the grantee’s rights.4NewYorkPublicLaw.org. N.Y. Real Property Law Section 291 – Recording of Conveyances (2025)
Different types of deeds offer varying levels of protection:
- Warranty Deeds provide the most protection, with the grantor guaranteeing the title.
- Bargain and Sale Deeds imply the grantor holds title but may not offer extensive warranties.
- Quitclaim Deeds offer the least protection, transferring only the grantor’s current interest, if any.
Transferring title also requires filing forms like the Real Property Transfer Report (RP-5217 or RP-5217NYC) and a Combined Real Estate Transfer Tax Return (TP-584 or TP-584-NYC) to pay any transfer tax, which is the seller’s responsibility.5NYS Department of Taxation and Finance. Real Estate Transfer and Mortgage Recording Tax Forms
Tax Implications of One-Party Ownership
Sole owners of real property in New York face annual property taxes, income taxes if the property generates revenue, and capital gains taxes when it’s sold.
Local governments and school districts charge property taxes based on the property’s assessed value. State law limits annual increases in assessed value for some residential properties (like one- to three-family homes) to 6% or 20% over five years, unless there are major physical changes.6FindLaw. New York Consolidated Laws, Real Property Tax Law – RPT § 1805 Assessment Limitations Sole owners are responsible for these payments.
New York offers programs to reduce property taxes. The School Tax Relief (STAR) program provides savings on school property taxes for primary residences. Basic STAR is for homeowners with household incomes up to $500,000. Enhanced STAR offers more benefits to income-qualifying seniors (age 65+), with income limits of $98,700 for 2024-2025 and $107,300 for 2025-2026.7NYS Department of Taxation and Finance. Enhanced STAR Income Limits Other exemptions may be available for seniors, veterans, and individuals with disabilities. A state real property tax credit is also available for homeowners and renters with household gross incomes of $18,000 or less, claimed via Form IT-214.
Rental income from the property is taxable by both federal and state governments. Deductible expenses can lower taxable rental income and include:
- Mortgage interest
- Property taxes
- Operating expenses like utilities and insurance
- Repairs
- Depreciation for the building (over 27.5 years for residential rental property)8Internal Revenue Service. Publication 527, Residential Rental Property
New York State taxes rental income at rates from 4% to 10.9%, and NYC may have additional local income tax. Rental income and expenses are reported on Schedule E of federal tax returns.
Selling property can result in capital gains tax on the profit. Federal law allows a sole owner to exclude up to $250,000 of gain from selling a primary residence if they owned and lived in it for at least two of the five years before the sale (this can be claimed once every two years).9Internal Revenue Service. Publication 523, Selling Your Home New York State taxes capital gains as regular income. For investment properties, previously claimed depreciation may be subject to recapture when the property is sold.
Sole proprietors with rental businesses also pay self-employment taxes. They can deduct one-half of their self-employment tax, health insurance premiums, and home office expenses. A federal pass-through deduction (Section 199A) may allow deducting up to 20% of qualified business income, but this is set to expire after 2025.
Estate Planning for Properties Held Alone
If you own real property solely in your name, planning for what happens if you become incapacitated or pass away is important. Without a plan, New York’s intestacy laws (EPTL) determine who inherits your property.10Justia. New York Estates, Powers and Trusts Law § 4-1.1 – Descent and Distribution of a Decedent’s Estate For instance, if a sole owner dies without a will and leaves a spouse and children, the spouse inherits the first $50,000 of the estate plus half of what’s left, with the children inheriting the other half. This court-supervised process can take time.
A Last Will and Testament allows you to name beneficiaries for your property and appoint an executor. For a will to be valid in New York, it must:
- Be in writing.
- Be signed at the end by the person making the will (testator).
- Be witnessed by at least two people who sign it within a thirty-day period, after the testator declares it’s their will.
Trusts are another option. Transferring property to a trust can help manage and distribute it, possibly avoiding probate for that asset. A revocable living trust allows you to keep control during your lifetime, with a successor trustee managing and distributing the property per the trust’s terms upon your death. An irrevocable trust generally cannot be changed once funded and may offer benefits like potential creditor protection. The trust document details trustee powers and beneficiary rights.
New York also offers a Transfer on Death Deed (TODD). This allows a sole owner to name a beneficiary who will automatically inherit the property upon death, bypassing probate. The owner keeps full control during their life and can change or revoke the TODD. It must be signed, notarized, and recorded before the owner’s death.
To plan for potential incapacity, a Durable Power of Attorney lets you appoint an agent to make financial and property decisions, including managing or selling real estate, if you cannot. The New York General Obligations Law outlines requirements for these documents. This can avoid the need for a court-appointed guardian. It’s a good idea to regularly review and update estate planning documents.