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Old 05-23-2015, 02:03 PM
 
Location: Chicago
5,559 posts, read 3,473,286 times
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Quote:
Originally Posted by mathjak107 View Post
co-ops are cheaper because they are cheaper than private homes
Coops are priced lower because the market is factoring the increased risk of this type of partnership vs. other types of real estate ownership, which by this time is fairly well established. Of you were ever involved with a partnership of any type, you will understand the risks of this type of limited partnership.
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Old 05-23-2015, 02:07 PM
 
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As i said you are talking in general terms when coop ownership is going to be based on individual experience.

You have likely just as many disgruntled homeowners who are sick and tired of the time ,energy and expenses of maintaining a house .
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Old 05-23-2015, 02:10 PM
 
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Quote:
Originally Posted by richrf View Post
Coops are priced lower because the market is factoring the increased risk of this type of partnership vs. other types of real estate ownership, which by this time is fairly well established. Of you were ever involved with a partnership of any type, you will understand the risks of this type of limited partnership.
Not only have i been part of limited partnerships in real estate but we owned a real estate holding company with bernard spitzer as my partner.

The prestigious co-op at 200 central park south was one of our buildings.

We still have two apartments left there.

We held the commercial lease rights there up until last year when we sold it to an investor group. Bernie passed away right after we broke up the partnership unfortunatly.
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Old 05-23-2015, 02:21 PM
 
Location: Chicago
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Quote:
Originally Posted by NYer23 View Post
If your serious about buying any property in a co-op you need to request the co-op financial statements and see the condition of the place for yourself.
Agreed. Due diligence is very important in any business transaction. In regards to coops, I would pay particular attention to:

1) Is there a true independent audit of all finances?

2) Is there frequent turnover of the Board coupled with a very active participation by all owners in the decision making process.

3) What rights do you have and don't have?

4) What is the turnover and mean time for sale

5) What capital expenditures have been performed and what is coming due? Ate the expenditures reasonable for the she of the building?

Owners and real estate agents will not discuss problems for fear of affecting price. It requires a great deal of homework to understand the nature of the business relationship you are entering into. Do not assume anything.
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Old 05-23-2015, 02:22 PM
 
Location: Chicago
5,559 posts, read 3,473,286 times
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Quote:
Originally Posted by mathjak107 View Post
As i said you are talking in general terms when coop ownership is going to be based on individual experience.

You have likely just as many disgruntled homeowners who are sick and tired of the time ,energy and expenses of maintaining a house .
The difference being a disgruntled homeowner can sell when they wish, to whom they wish, at the price they are will to accept. This is a critical difference which is why coops command a lower valuation.
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Old 05-23-2015, 02:29 PM
 
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I bet you will find very few here who had any issues selling and there are quite a few owners here.

You are running on a problem that may be issues in very high end co-ops but is basically transparent to 90% or more of co-op buyers and sellers.
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Old 05-23-2015, 02:33 PM
 
Location: Chicago
5,559 posts, read 3,473,286 times
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Quote:
Originally Posted by mathjak107 View Post
I bet you wilp find very few here who had any issues selling and there are quite a few owners here
The market has spoken. No need to take a small poll on this forum of members with unclear interests and biases. Unfortunately with coops, there is no way to mitigate the risks since it is completely out of the hands of the limited partner. Even excellent due diligence does not preclude the possibility of a new Board moving in the strong direction.
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Old 05-23-2015, 02:36 PM
 
64,537 posts, read 66,100,109 times
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The market hasn't spoken. You have spoken but you are not accurate in what you are throwing out there as general problems across the board.

Sorry but you are parroting something that is not true across the board.
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Old 05-23-2015, 02:38 PM
 
1,975 posts, read 1,234,875 times
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Quote:
Originally Posted by richrf View Post
Owners and real estate agents will not discuss problems for fear of affecting price. It requires a great deal of homework to understand the nature of the business relationship you are entering into. Do not assume anything.
Closing Lawyer and bank will looking into this for you. Most prime Manhattan area's co-op are well run so there won't be a issue, however, you get more sketchy as you reach less desirable areas.

Unfortunately unless you are rich, it is difficult to avoid the co-op market if you want to live in NYC long term. Co-op can be a good investment it just a complex transaction compared to other investment vehicles.
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Old 05-23-2015, 02:40 PM
 
Location: Chicago
5,559 posts, read 3,473,286 times
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It is not only true, it is a fact. Everyone knows this but they may not understand the underlying rationale. This begs the question, why were coops created in the first place? They are very rare in Chicago for the reasons cI have given. New York has its own history and looking into three history and the laws governing rental buildings may provide some clues as to why coops ate much more numerous in NY than elsewhere.
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