Peconic Bay Transfer Tax: What East End Long Island Buyers Need to Know

If you're buying property in the Hamptons, North Fork wine country, or anywhere else on Long Island's East End, you'll encounter a transfer tax that doesn't exist anywhere else in New York. The Peconic Bay Community Preservation Fund tax is a local real estate transfer surcharge that adds materially to your closing costs — and it surprises buyers who've only researched standard New York State transfer tax rates.

Here's how it works and what it will cost you.

What the Peconic Bay Transfer Tax Is

The Peconic Bay Community Preservation Fund (CPF) was established by New York State in 1998 to fund the preservation of open space, farmland, historic properties, and recreational areas in the five East End towns of Suffolk County. The fund is financed by a real estate transfer tax on property sales within those municipalities.

The five East End towns impose an additional surcharge on qualifying real-estate transfers. The current rate, who pays it, and available exemptions must be confirmed locally; do not rely on a fixed percentage in a generic closing-cost estimate.

Which Towns and Villages Charge the Peconic Bay Transfer Tax

The CPF tax applies in the following five East End towns (and all incorporated villages within them):

• Town of East Hampton (including East Hampton Village, Sag Harbor, Montauk, Springs, Amagansett, Wainscott, etc.)
• Town of Southampton (including Southampton Village, Bridgehampton, Sag Harbor, Water Mill, Sagaponack, Westhampton Beach, etc.)
• Town of Shelter Island
• Town of Riverhead (including Jamesport, Aquebogue, Calverton, etc.)
• Town of Southold (including Greenport, Mattituck, Cutchogue, Southold Village, Orient, etc.)

Note that Sag Harbor straddles both East Hampton and Southampton — the CPF tax applies throughout.

Most of western Suffolk County and all of Nassau County are not subject to the CPF tax.

How Much Will You Pay?

The current Peconic Bay CPF rate, tax base, payment responsibility, and any minimum or exemption rules should be confirmed with the applicable town and your closing attorney or title closer before you rely on the charge in a budget.

Examples:

On an East End purchase, confirm the current CPF charge and payment timing with the closing attorney or title closer. It is in addition to ordinary purchase costs and any applicable New York State mansion tax, which applies to purchases of $1 million or more statewide, including the East End.

Exemptions from the Peconic Bay Transfer Tax

Exemptions and special rules vary by town and program. Ask your attorney whether an applicable exemption applies to your transaction and confirm the current requirements locally.

Agricultural and other specific land use exemptions also exist for qualifying properties, but these are not relevant for most residential buyers.

Who Pays It and When

The payment responsibility and collection procedure should be confirmed with the applicable town and your closing attorney or title closer.

The standard New York State transfer tax is a separate line item; in a standard resale it is generally seller-paid. Confirm how the local CPF charge is allocated in your contract and closing statement.

How This Affects Your Closing Cost Budget

If you're comparing the cost of buying on the East End versus elsewhere in New York, the Peconic Bay transfer tax is a material differentiator.

A buyer purchasing a home in Nassau County (not one of the five East End towns) would not face the Peconic Bay charge, while an East End purchase may carry the additional local surcharge. Model the difference using the current town rules and the property's actual closing costs.

An East End buyer should ask the title closer to show the CPF charge separately from the standard transfer taxes, MRT, title, and attorney costs before setting a cash-to-close target.

Factor this explicitly into your affordability calculation before falling in love with a specific East End property. Real estate agents quoting estimated closing costs in these markets don't always lead with the CPF tax — make sure your attorney includes it in your closing cost estimate from the start.

The CPF Tax and East End Market Dynamics

The East End real estate market has some of the highest median prices in New York State. The Peconic Bay CPF tax has not materially suppressed prices — demand for Hamptons, North Fork, and Shelter Island properties has remained strong — but it does represent a genuine friction for entry-level buyers in these markets.

For buyers using financing, confirm with the lender and closing attorney whether the CPF charge must be funded in cash at closing and whether it can be included in the financing structure. Build the confirmed amount into the cash-to-close calculation rather than relying on a generic estimate.

The East End of Long Island has some of New York's most desirable real estate — and some of its most expensive closing costs. The New York First-Time Home Buyer Guide covers the full closing cost structure for buyers across all regions of New York State, including the specific taxes and fees that apply in each market.

See more New York guides →