The seller pays now. As of July 10, 2025, New Jersey flipped the old “mansion tax” from a 1% buyer charge into a seller-paid, tiered fee on homes over $1 million. It starts at 1% and climbs to 3.5% on sales above $3.5 million, and it applies to the entire sale price, not just the amount over the threshold. On the Gold Coast, where a two-bedroom can clear $1 million, this is not a mansion problem. It is an everybody problem.
What actually changed
For twenty years, buyers paid a flat 1% fee on purchases of $1 million or more. The 2025 law did two things at once: it moved the obligation to the seller, and it made the rate graduated. Sellers also still pay New Jersey’s separate realty transfer fee, which existed all along. So a seller’s total transfer cost at closing now has two parts stacked together.
The current tiers
- Under $1,000,000, no supplemental fee
- $1,000,000 to $2,000,000, 1%
- $2,000,000 to $2,500,000, 2%
- $2,500,000 to $3,000,000, 2.5%
- $3,000,000 to $3,500,000, 3%
- Over $3,500,000, 3.5%
The rate applies to the full price. Sell at $2,100,000 and you owe 2% of the whole number, $42,000, not 2% of the overage. That cliff at each threshold matters enormously for pricing strategy.
Why the thresholds change how we price
Here is the conversation I now have with every seller near a tier line. If your home is worth right around $2 million, the difference between closing at $1,995,000 and $2,050,000 is not $55,000 in your pocket. At $1,995,000 the fee is 1%, about $19,950. At $2,050,000 it jumps to 2%, $41,000. You grossed $55,000 more and handed $21,050 of it back. Sometimes the smart move is pricing to close just under a threshold, and sometimes buyer demand blows through it anyway, but you should never stumble across a tier line by accident.
Buyers near a threshold should understand this too. A seller at $2,040,000 has a genuine financial reason to accept $1,999,000. That is negotiating information you did not have before 2025.
What this means for a typical Gold Coast sale
Say you are selling a Hoboken brownstone condo at $1.4 million. Your supplemental fee is $14,000, on top of the standard realty transfer fee, commission, and attorney costs. Sell a larger home at $3.4 million and the supplemental fee alone is $102,000. These numbers belong in your net sheet on day one, not as a surprise at the closing table. When I run a pricing analysis for a seller now, the tier math is built into every scenario.
Common questions I get
Does this apply to condos and brownstones, or just houses? It applies to residential sales over $1 million, period. Most of what trades in Hoboken and Downtown Jersey City above $1 million is a condo.
Can the buyer agree to pay it instead? The legal obligation sits with the seller. Deal terms can shift economics around, but in practice, on-market deals price it in rather than reassign it.
Was there a window where old deals were protected? Contracts signed before the effective date had transition relief if they closed by a deadline in late 2025. At this point, every new deal is under the new rules.
The one takeaway
If you are selling anything over $1 million in Hudson County, the transfer math changed and it now runs six figures at the high end. Get a real net sheet before you pick a list price, and treat the tier thresholds as strategy, not trivia. This is general information, not tax or legal advice; your attorney and accountant should confirm how the rules apply to your sale.
Want a net sheet for your specific home? Reach me at 908-227-8226 or [email protected]. You can also see what your home might sell for by starting at homes.hudsonagents.com.