Vélez signed with the New York Yankees as an amateur free agent on December 23, 1969, and worked his way through their minor league system.

He made his Major League Baseball debut with the team on September 4, 1973, where he recorded his first hit off Detroit Tigers pitcher Mickey Lolich.

Vélez hit his first career home run on September 23 off Dick Tidrow of the Cleveland Indians in the second inning, then hit another home run in his next at-bat against Tidrow in the fourth inning to lead the Yankees to a 9–1 victory over Cleveland.

Vélez appeared in one game, going hitless in one at-bat in the American League Championship Series against the Kansas City Royals.

On November 5, 1976, the Toronto Blue Jays selected Vélez in the 1976 MLB expansion draft.