Anthony Licciardello | May 1, 2026
Long Beach Island
LBI · Closing Costs · 2026
Since July 2025, the biggest closing checks on Long Beach Island are written by the seller. Here is every line, what it costs on a $2.5 million bayfront sale, and where the tier cliffs sit.
The Argument in Brief
A $2.5 million LBI bayfront sale now moves more than $250,000 through closing. For a non-resident seller, the Realty Transfer Fee, the seller-paid Graduated Percent Fee and the GIT/REP withholding come to about $128,000 before commission. Buyers, meanwhile, pay a comparatively modest $13,000 to $21,000 in cash-purchase closing costs, but they need a bayfront-specific due-diligence stack that a standard inspection does not cover.
New Jersey closing costs fall into four buckets: state fees, county and municipal charges, third-party services, and property-specific costs. On Long Beach Island the balance tilts heavily toward the seller, for two reasons. First, since July 10, 2025 the fee on sales over $1 million is legally imposed on the seller rather than the buyer. Second, a large share of LBI sellers are non-residents of New Jersey, which triggers GIT/REP estimated-tax withholding at closing.
New Jersey has charged a Realty Transfer Fee (RTF) since 1968. The seller pays it, and it is calculated per $500 of consideration. The key detail most summaries get wrong: once the total price exceeds $350,000, the entire price is run through a higher schedule, not just the portion above $350,000.
Portion of Price (sale over $350K) | Rate per $500 | On a $2.5M Sale |
|---|---|---|
$0–$150,000 | $2.90 | $870 |
$150,000–$200,000 | $4.25 | $425 |
$200,000–$550,000 | $4.80 | $3,360 |
$550,000–$850,000 | $5.30 | $3,180 |
$850,000–$1,000,000 | $5.80 | $1,740 |
Over $1,000,000 | $6.05 | $18,150 |
Total RTF | $27,725 |
Sales of $350,000 or less use a lower schedule ($2.00, $3.35 and $3.90 per $500). Reduced rates exist for qualifying senior citizen (62+), blind and disabled sellers and for low- and moderate-income housing, but the eligibility conditions are narrow and rarely apply to LBI second homes.
Under P.L. 2025, c. 69, enacted June 30, 2025, New Jersey replaced the flat 1 percent buyer-paid fee on residential sales over $1 million with a graduated fee paid by the seller. It applies to deeds submitted for recording on or after July 10, 2025. The rate is applied to the entire consideration, not just the amount over each threshold, which creates a cliff at every tier boundary.
Sale Price | Rate | Example |
|---|---|---|
$1,000,001–$2,000,000 | 1% | $15,000 on $1.5M |
$2,000,001–$2,500,000 | 2% | $50,000 on $2.5M |
$2,500,001–$3,000,000 | 2.5% | $72,500 on $2.9M |
$3,000,001–$3,500,000 | 3% | $96,000 on $3.2M |
Over $3,500,000 | 3.5% | $140,000 on $4M |
There are no senior, disability or veteran exemptions from this fee. It matters on LBI because typical single-family sale prices sit right on top of the $2 million and $2.5 million cliffs: 2025–2026 town medians ran from roughly $1.6 million in Ship Bottom to $2.3 million in Surf City and higher in Beach Haven. For the wider regulatory context, see the three new rules rewriting the Jersey Shore real estate playbook.
A seller who is not a New Jersey resident must make an estimated income tax payment at closing equal to the greater of 10.75 percent of the taxable gain or 2 percent of the sale price. This is not a transfer tax; it is a prepayment of New Jersey income tax, reconciled when the seller files the NJ-1040NR, and any excess is refunded.
The forms are GIT/REP-1 (non-resident seller’s declaration filed with the payment), GIT/REP-2 (prepayment receipt) and GIT/REP-3 (seller’s residency certification or exemption). New Jersey residents, sellers excluding gain under IRC Section 121 on a principal residence, and certain foreclosure, government and corporate transfers can be exempt. On a $2.5 million sale where 10.75 percent of the gain is less than $50,000, the 2 percent floor applies and the seller remits $50,000.
Buyers of LBI bayfront property need more than a standard inspection:
Item | Typical Cost |
|---|---|
Tidelands search (24–48 hours) | $200–$500 |
Marine engineer / bulkhead inspection | $1,000–$3,000 |
Survey | $1,500–$3,500 |
Standard home inspection | $500–$900 |
Wood-destroying insect (WDI) | $100–$200 |
Core stack total | $3,300–$8,100 |
Septic certification (if applicable) | $400–$1,000 |
Well water testing (if applicable) | $200–$500 |
Order the tidelands search first. An unresolved State tidelands claim can force an escrow at closing or delay the lender’s funding. The full picture is in our LBI bayfront riparian rights buyer guide, and the bulkhead side is covered in the LBI bulkhead question.
Realty Transfer Fee | $27,725 |
Graduated Percent Fee (2%) | $50,000 |
GIT/REP estimated tax (2% floor) | $50,000 |
Commission (5%, illustrative) | $125,000 |
Closing attorney | $1,500–$2,500 |
Title / payoff handling | $500–$1,500 |
Total at the table | ~$254,700–$256,700 |
Owner’s title insurance | $7,350–$8,800 |
Tidelands search | $200–$500 |
Marine engineer | $1,000–$3,000 |
Survey | $1,500–$3,500 |
Home inspection + WDI | $600–$1,100 |
Buyer’s attorney | $1,500–$2,500 |
Recording, settlement, misc. | $700–$1,500 |
Total (excluding financing) | ~$12,850–$20,900 |
Financing adds roughly $15,000 to $30,000 in lender fees, prepaid items and escrows. In our transaction experience, a large share of LBI buyers at this price point pay cash. For how these numbers shift between the ocean and the bay, see our LBI oceanfront vs. bayfront 2026 analysis.
On a $2.5 million LBI sale by a non-resident, the RTF, Graduated Percent Fee and GIT/REP together come to about $128,000 before commission and attorney fees. Of that, the seller’s transfer fees alone ($77,725) are about 2.8 times the $27,725 RTF the seller paid on the same sale before July 10, 2025, when the 1 percent fee was the buyer’s cost. Total state transfer-fee revenue on the deal rose about 1.5 times, from roughly $52,700 to $77,700.
That is why pricing now has to respect the tier boundaries. Moving a list price from $2,490,000 to $2,510,000 adds about $13,000 in combined seller fees, so a $20,000 bump nets the seller roughly $7,000. Buyers should budget for the bayfront stack and order the tidelands search early. For the statewide view, read our general NJ closing costs breakdown for 2026, and for market context, the 2026 LBI market report.
Vortex Modeling Disclosure
Statutory fees in this guide (RTF, Graduated Percent Fee, GIT/REP) are Anchored to New Jersey Division of Taxation schedules, and the title premium is calculated from the Rating Bureau manual. Service-cost ranges and the LBI typical sale-price band are modeled ranges, not point estimates, built from multiple independent public, portal and vendor sources and graded by confidence: Anchored (recorded or official data), Corroborated (two or more independent sources within about 10%), Indicative (two sources, wider spread), Directional (single source or thin sample; trend only) or Insufficient. The $1.9M–$2.4M sale-price band is Indicative; third-party service costs are Indicative. None of this is an appraisal, quote or guarantee, or legal, tax or financial advice; confirm every figure with your attorney, title company and tax professional.
Sources: NJ Division of Taxation Realty Transfer Fee schedules and Graduated Percent Fee notices; NJ Land Title Insurance Rating Bureau manual of rates; Redfin and Houzeo LBI town market pages (2025–2026); Ocean County vendor and contractor pricing.
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The RTF is about $21,675. At exactly $2,000,000 the Graduated Percent Fee is 1 percent, or $20,000, for a total of about $41,675. At $2,000,001 the fee jumps to 2 percent, or $40,000, for a total of about $61,675. The seller pays both.
The seller, for deeds submitted for recording on or after July 10, 2025, at graduated rates of 1 to 3.5 percent on sales over $1 million. For sales over $2 million under a contract fully executed before July 10, 2025 and recorded by November 15, 2025, the seller could claim a refund of the amount paid above 1 percent within one year of recording.
A non-resident seller makes an estimated New Jersey income tax payment at closing equal to the greater of 10.75 percent of the gain or 2 percent of the price, reconciled on the NJ-1040NR. Sellers who qualify for the Section 121 principal-residence exclusion may claim an exemption on GIT/REP-3.
About $12,850 to $20,900 for a cash purchase, including title insurance, the bayfront due-diligence stack, attorney and recording costs. Financing adds roughly $15,000 to $30,000.
Sources: NJ Division of Taxation, Realty Transfer Fee page and rate schedules; NJ Division of Taxation, Graduated Percent Fee notice and implementation clarification; P.L. 2025, c. 69 (N.J.S.A. 46:15-7.2); NJ Division of Taxation GIT/REP-1, -2 and -3; New Jersey Land Title Insurance Rating Bureau manual of rates and charges. This article is informational and does not constitute legal, tax or financial advice.
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