Attn nyc coop shareholder/board (real estate, apartment, insurance)

[Maximus_01]

Happy Holidays!

I've recently purchased a co-op in Downtown Brooklyn. After closing, the maintenance rate has increased dramatically from 5% (from previous year 2021 & for upcoming year 2022) to 9.5% (from previous year 2022 & for upcoming 2023). My understanding is the maintenance rate (for the upcoming year) may annually increase by 2-5% (from the previous year). So the increase of 9.5% seems absurd and tremendous.

I understand the maintenance fee differs for all units in the same building as the square footage may differ depending on the unit size. However, would the percentage of maintenance increase also differ? For example, would a studio vs 2 bedroom equally increase to 9.5% in maintenance for the upcoming year, 2023?

Would appreciate some insight and guidance. Thank you in advance!

[BBMW]

Each unit is assigned a number of shares. This was calculated when the building's offering plan was put together prior to it's initial sale. It usually takes into account unit size and how high in the building it is (higher usually considered more valuable.) Other factors may have come into play. But once set, it is what it is, and never changes.

Maintenance fees are determined on a per share basis. So your maintenance payment is calculated by taking the number of shares for your unit X the per share maintenance charge.

As to why your maintenance is going up, wake up and smell the inflation. The cost of everything is going up, and that has to be paid for. Think electricity, gas, labor, and, especially, property taxes. Because the value of NYC real estate has gone up so much in the last decade or more, property taxes have gone up with that. I live in a coop, and am on the board. I see the numbers. Property taxes are more than half of our operating budget.

[kisp624]

Prior to 2021, my coop didn’t have an increase for 10 years. Then we got an increase last year and another 6% for 2023 plus a new fuel/energy surcharge. This was blamed on rising insurance and energy costs as well as the new 32BJ contract.

[Maximus_01]

Originally Posted by BBMW

Each unit is assigned a number of shares. This was calculated when the building's offering plan was put together prior to it's initial sale. It usually takes into account unit size and how high in the building it is (higher usually considered more valuable.) Other factors may have come into play. But once set, it is what it is, and never changes.

Maintenance fees are determined on a per share basis. So your maintenance payment is calculated by taking the number of shares for your unit X the per share maintenance charge.

As to why your maintenance is going up, wake up and smell the inflation. The cost of everything is going up, and that has to be paid for. Think electricity, gas, labor, and, especially, property taxes. Because the value of NYC real estate has gone up so much in the last decade or more, property taxes have gone up with that. I live in a coop, and am on the board. I see the numbers. Property taxes are more than half of our operating budget.

Yes, sure. However, with 7 co-op complexes with over 1000 units, energy here is bought in bulk along with other services, intangible or tangible. When comparing this coop with a neighboring coop, their maintenance fee has also increased, but is still significantly lower. Please respectfully save your snarky comment "to smell the inflation" for someone else.

[BBMW]

Your rate of increase will be every bit as high as anyone else. You're probably only starting at a slightly lower per unit of purchase base. If you think you're immune from inflation you're an idiot,

Originally Posted by Maximus_01

Yes, sure. However, with 7 co-op complexes with over 1000 units, energy here is bought in bulk along with other services, intangible or tangible. When comparing this coop with a neighboring coop, their maintenance fee has also increased, but is still significantly lower. Please respectfully save your snarky comment "to smell the inflation" for someone else.

[TheWiseShopper]

I'm having the same issue in my co-op. Every damn year, the maintenance increases. First, it started as 1-2% per year. Now, it's increasing 3-4% per year and now, we are hit with an annual assessment charge on top of that. It's out of control.

Before I bought my apartment 7 years, I literally asked around the building and everyone told me that there is rarely a maintenance increase... like once every 100 years; that's how rare people claimed it was. But since I moved in, that once per 100 year increase has changed to once a year.

It's really crazy. I really wonder why the Board of Directors keep doing this, especially since the Board are shareholders themselves who also pay maintenance. So they are getting hit with a maintenance increase that they approving. What the hell? Hasn't anyone heard of proper budgeting??

[pureistheword]

Shareholders are simply paying their prorated share of the property budget, as noted many costs are going up sharply.
You are entitled to annual financials which I am sure you reviewed but this may not have give a view into the reasons for the increase, at least in full.
Was there a review of the last several years of building finances and their increases as well as meeting minutes. Combined they might have given clues to being underfunded and need to catch up, needing to make larger increases to capital reserves based on an audit of life expectancy of the roof, elevators. The minutes might clue in lawsuits, because shareholders pay those legal costs. Its possible they are wasteful with money.
Honestly, I would ask if the board if they can shed some light

[Dave 92 LSC]

Inflation is under control they say.

[kingelz83]

From your reply, it's obvious you think you're immune from respect and education. But then again, maybe you are just an idiot.

Originally Posted by BBMW

Your rate of increase will be every bit as high as anyone else. You're probably only starting at a slightly lower per unit of purchase base. If you think you're immune from inflation you're an idiot,

[Cida]

I'm not sure where you got that 2%-5%, but to the best of my knowledge, there is nothing limiting any increases. A co-op has to pay its bills. If bills go up 20% the money has to come from the shareholders.

Sorry for the nasty shock with the announcement.