New York based property management firm, All Area Realty Services blog. Find tips for Co-Op Boards & Residential Building Management.

A Buyer's Market In NYC

Posted by All Area Realty Services Team on Oct 3, 2019 3:59:27 PM

These days, we are in a buyer’s market in much of New York City and therefore, co-ops and condos need to entice buyers with amenities. Most new buildings have many amenities but older buildings are lacking amenities like gyms, dog runs and roof decks. Learn what most prospective buyers are looking for in amenities.  

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Roof decks are a huge draw for buyers, especially if there is a furnished common space. Buyers want a place where they can meet people and hang out. People want to have a sense of community and having a roof deck provides an opportunity for people to meet their neighbors. When a building has a community room, it can function as a meeting place and a recreation spot for the residents. 

Buyers want a gym in their building. Older co-ops and condos do not need much space to create a well stocked gym. If there is unused storage space, it can easily be converted into a gym. 

Storage is important to potential buyers as well. Buyers want package rooms as well. They are also interested in buildings that are energy efficient and have less of a carbon footprint.

If you own an apartment in an older building, these co-ops and condos need to consider how they can make themselves more attractive to potential buyers. Ask what is in the budget and if there is space. If the building can accommodate the amenity and the residents want it, then add it to the building.   

All Area Realty Services is New York City’s leading real estate management company specializing in full-service professional property management for cooperative and condominium boards in the Manhattan area.

Topics: Buying a Co-Op, Selling a Co-Op

The Best Ways to Avoid Co-Op Board Rejection

Posted by All Area Realty Services Team on Sep 19, 2019 3:50:25 PM

The first step to finding your dream co-op is becoming aware of the possible ways your application could be rejected. That incites will enable you to zero in on the right buildings as well as adjust your application to avoid rejection. It is also imperative that you hire a broker who knows the criteria and delicate nature of the co-op boards you want to apply to. And also has the ability to create a fail-safe board package that can be your golden ticket into the co-op of your dreams. To help you get into the co-op you desire listed below are the top dozen ways to avoid application rejection. 

  1. Financials 

It is crucial that a prospective buyer has sufficient assets following a closing. A board is looking for:

  • An adequate amount of liquid assets. 
  • Potentially two to four times the value of the purchased apartment after closing
  • Two to three years of maintenance and mortgage payments in your bank account after all closing costs have been paid. 

An experienced broker will be aware of each building’s requirements and also keep on top of those changing variables, as new boards are elected every year and the criteria for new buyers changes. 

Tip: A standard rule is that co-op boards usually want a buyer to be able to allot 25 percent of their earnings to the payment of mortgage and maintenance. 

  1. Job History

Most co-op boards will also request your job history along with your annual earnings. A board wants a buyer to demonstrate job stability, it isn’t uncommon for an application to be rejected because a prospective buyer changed jobs too frequently even though they had sufficient funds. 

  1. Bad Credit

Even if you have a good income and plentiful assets your application could still be rejected if you have a poor credit score. This is especially true if you have a negative track record of paying your current maintenance fees or rent. 

Tip: Another reason to hire a good broker is because they will review a client’s financial history to make sure there are no red flags that could warrant rejection by a board. 

  1. Pied-a-Terre

The acceptance of pied-a-terres depends on the board. Some boards are entirely receptive to pied-a-terres while others make decisions on a case-by-case basis and some don’t allow them at all. Make sure to discuss with your broker if you’re looking for a pied-a-terre so they can gain a clear understanding of the rules in the building of interest. 

Keep in mind even if a building will consider the sale of an apartment as a pied-a-terre, the board can still reject part-time tenants who they feel will be spending too little time in the apartment. 

  1. Guarantor

If you require a guarantor make your broker aware. This will allow them to make sure that all prospective buildings are guarantor friendly. Most buildings change their rules and bylaws annually, so your broker must be up-to-date on those changes to prevent rejection. 

Tip: Even if a building permits guarantors you should qualify your guarantor because boards will require a couple years of tax returns and a verification of income and assets. 

  1. Lifestyle

The acceptance of shareholders with high public profiles varies from board to board. Some boards would rather not have any undue attention on their buildings. And of course, most buildings don’t want those who will upset the peace, quiet, and security of its shareholders. 

  1. Home Work

As long as your occupation doesn’t involve a revolving door of clients in and out of the building most boards will be accepting of tenants working in their homes. For example, a writer and freelance editor is acceptable but a psychiatrist will most likely be rejected. 

  1. Failure to Fulfill Additional Requirements 

Once you have sent a comprehensive package to the board with all requested information they may still require additional documentation for clarification or a precondition escrow deposit before granting an interview. If you do not consent to the supplementary demands it is likely that the board will reject your application. 

A common request is for one to three years of maintenance in escrow. If a board reviews your application and feels that you don’t have strong enough financials they may still approve the purchase if you agree to put maintenance into an escrow account. After you have a history of meeting financial responsibilities the escrow will be dissolved and the funds returned. If you do not agree to the maintenance escrow you will be rejected. 

  1. Low Purchase Prices

If a shareholder is selling their co-op apartment at a below-market price in order to entice a rapidly executed deal, the board will reject the buyer. This is because these deals reduce the value of all the apartments in the building. 

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  1. Pets

This also falls under the necessary due diligence of your broker. It is up to them to learn which buildings are pet-friendly. Even though some buildings allow dogs, it is still up to your broker to learn the potential limitations on the number or breed of dogs allowed. 

Tip: Most boards only allow two dogs per apartment and won’t allow Pit Bulls, Mastiffs, or Rottweilers. Some won’t even permit dogs that weigh more than 50 pounds. 

  1. Noise

You can be rejected if your profession or hobby entails making noise that will disrupt the other shareholders. For example, a drummer or tap dancer may be rejected. Some boards may still approve your application on the contingent upon sound-proofing your apartment, prior to taking possession of the apartment. 

  1. A Poor Interview

An astute broker will prepare you for the inevitable board interview. To avoid a poor interview you should: 

  • Be on time.
  • Appropriately dressed. 
  • You shouldn’t ask questions that can trigger concerns or suspicions in even just one board member. 
  • You should answer all questions politely and as concisely as possible.

Once you have been accepted by the board, have closed on your apartment and moved in, you can make any suggestions and ask as many questions of the board as you wish. 

If you keep in mind these 12 ways to avoid rejection by a co-op board and hire an experienced and detail orientated broker you should be closed and moved into the co-op you desire in no time. 

All Area is New York City’s leading real estate management company specializing in full-service property management for cooperative and condominium boards in the Manhattan area.

Co-Op Boards & Condo Boards

Posted by All Area Realty Services Team on Sep 5, 2019 4:59:07 PM

A board whether it is a condo or co-op board is a group of elected volunteers. It is a boards duty to overlook complaints, hire a property manager, create and enforce the rules of the building. Co-op boards and condo boards have a lot of similarities in their functions, but there are some key difference you should be aware of when choosing between a co-op or a condo.

Co-Op Boards

The elected officials of a co-op board generally hire a property management company to supervise the care and maintenance of the building. The only exception is found amongst smaller buildings that may choose to self-manage with the intent to save money.

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In addition to hiring a property manger the board is responsible for creating and enforcing the rules of the co-op. Some common board rules are:

  • Whether you can speak on your cell phone in the lobby.
  • If (and what kind of) dogs will be allowed in the building.
  • When and what kind of renovations can take place inside your unit.
  • What activities are allowed to transpire on the roof deck.

A co-op board also holds the right to evict overly disruptive shareholders and force them to sell their unit.

Condo Boards

The directors of a condo board hold many of the same responsibilities and functions of a co-op board. However, most condo boards tend to have a more laissez-fair approach to rule making.

This more hands-off approach is mostly due to the fact that condos wield less legal power to enforce their rules. A board can’t evict an owner from an apartment like a co-op board can. This is because condo owners actually own their unit versus owning shares as in a co-op. A condo board can, however,  get a court ordered junction to stop any rule infraction from occurring again.

An important fact to keep in mind is that in both a co-op and a condo, your voting power has a direct relationship with the size of your apartment. Thus the bigger the apartment the greater the voting power you will posses. Both condos and co-ops have their pros and cons. The question you need to ask yourself is, would you prefer a more hands on or hands off approach to governing in your building?

All Area is New York City’s leading real estate management company specializing in full-service property management for cooperative and condominium boards in the Manhattan area.

 

Topics: Co-Op Board, Buying a Co-Op, Co-Op Building

Owning A Home: The American Dream

Posted by All Area Realty Services Team on Aug 29, 2019 3:26:48 PM

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The American dream is to own a home. However, these days more than a quarter of Americans live in a community association- a housing cooperative, condominium or homeowners association. In Florida, there are 48,250 associations, which is the most in the country. California has the next highest with 48,150, followed by Texas (20,050), Illinois (18,700), North Carolina (14,000) and New York (13,875). The home value of these communities is around $6.28 trillion with about $96 billion in assessments collect annually from the homeowners to fund essential maintenance.

There are numerous reasons for the growth of these community associations. First, there is value to having collective management consisting of democratically elected volunteer homeowners to serve their communities. In the US, there are 2.5 million community association board and committee members.

Also, many local municipalities face fiscal challenges and therefore, communities develop with the stipulation that the association will assume many responsibilities that traditionally belong to local and state government, like road maintenance, snow and trash removal and stormwater management. Most communities have reserve funds for repair, replacement and enhancement of common property, including elevators, swimming pools and streets.

These communities expand affordable housing and increase the percentage of homeowners in the U.S. Since the 1960s, condominiums tend to serve as an affordable option to buy housing, especially for first-time buyers. Condominiums account for about 40% of the total of community associations. In New York City, most buyers tend to buy condominiums because condos are real property and they do not have to submit a comprehensive packet to the co-op board, only to be denied ownership. 

All Area Realty Services is New York City’s leading real estate management company specializing in full-service professional property management for cooperative and condominium boards in the Manhattan area.

Topics: Buying a Co-Op, Selling a Co-Op

Do You Know Who Is Responsible For What In Your Building?

Posted by All Area Realty Services Team on Aug 8, 2019 4:22:25 PM

In a building, there are property managers and the building board, and in order for the building to function best, they both need to collaborate to implement policy, carry out administrative duties and make efficient decisions about how to run the building. Management contracts will detail the duties of the manager but at times, there will be confusion about who is responsible, board or property manager, for different duties. Smooth relations occur when each party knows their role and obligations.

When a building has a hands-on board, it may seem that the role of the board and property manager overlaps. It might seem helpful but in the long run, it does not help the running of the building. The board makes the policy for running the building, after speaking to the property manager and the financial decisions of the building. The board must remember that the property manager works for them.  The property manager provides information to the board so they can make informed decisions.

iStock-127544823Board members develop the direction, policy and procedures for the building and the property manager implements them. The board’s responsibility is to make sure that the management company performs the day-to-day operations of the property. However, at times, a board member might become too closely involved with the oversight of contractors even though that is the property manager’s responsibility. There may be a clause in the management contract, which limits the spending power of the property manager. Most times, any significant cash outlay must be ok’d by the board first. When an emergency happens, the property manager has a duty to protect the property and its residents.

There might be times when the board pressures the property manager into doing work that is not part of the manager’s job. An example is pushing tasks on the manager that the board does not want to deal with. When a board member acts like a property manager, he or she may find themselves in over their heads.

The relationship between the board and property manager is a partnership but a partnership that is clearly defined. Managing agents should not make decisions about the building and should never sign contracts on behalf of the board. In order to avoid confusion about responsibilities, make sure the terms of the relationship are clear and well defined. Also, a managing agent should never get involved with the politics of the board. Remember, the board signs the property manager’s paychecks and therefore, the board is the customer, who is always right.

All Area Realty Services is New York City’s leading real estate management company specializing in full-service property management for cooperative and condominium boards in the Manhattan area.

Topics: Co-Op Board

Looking To Buy A NYC Co-Op?

Posted by All Area Realty Services Team on Aug 2, 2019 1:59:11 PM

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Are you thinking about buying a co-op apartment in New York City? Read on for all the details involved in purchasing your very own piece of NYC.

Purchasing a co-op takes about three months from the time you sign the contract of sale until you close. Closing costs are less than when you buy a condo. NYC co-ops have strict financial requirements and sublet restrictions. There is a lengthy board application and board interview before you can close on the apartment. Buying a co-op is generally less expensive than purchasing a condo because there are more co-ops than condos and investors tend not to buy them due to the sublet restrictions.

When you buy a co-op, you buy shares in the corporation. You received the shares and proprietary lease at closing. Co-ops are not considered real property. The board of directors runs the building and they enforce the various rules.

Once you have an accepted offer, you will need to hire a real estate attorney to review the contract, due diligence and negotiation and representing you at the closing. Your attorney will review the co-op’s original offering plan, the building’s financials statements, house rules and the board’s purchase application. Upon signing the contract, you will need to write a check for 10% of the purchase price as the deposit. The contract is not valid until both the seller and the buyer sign it. Now each party is legally bound to the transaction. Typically, after an executed contract, the closing will be in two to three months. Beware; that a co-op board may reject a purchase contract and if this is the case, then the buyer can leave the deal without penalties. The buyer may never get a reason for the rejection.  However, in most cases, a buyer should keep his or her interview short, sweet and polite. Most times, the board has already approved you and they just want to meet their newest neighbor.

Once you receive board approval, the managing agent will contact you and you will be able to close within one to two business days after the interview. After the co-op board approval, you need bank approval and then the attorneys will coordinate a closing date that works for all parties.

The day before closing, your real estate broker will schedule a final walk-through for you to inspect the apartment and to make sure everything is in working order. Look for any damage that may have been caused by the movers. In New York, properties are sold as is and the only way to prove that something has changed substantially is to take photos.

On the day of closing, there will be attorneys representing the bank, the seller and the buyer as well as the building’s managing agent and the real estate brokers. After all the papers have been signed, you will receive the key to your very own apartment.

All Area Realty Services is New York City’s leading real estate management company specializing in full-service professional property management for cooperative and condominium boards in the Manhattan area.

Topics: Buying a Co-Op, Selling a Co-Op

The New Rent Laws May Change New York City Housing

Posted by All Area Realty Services Team on Jul 25, 2019 5:55:03 PM

New York State passed new rent laws that will change New York City housing. Before these laws were passed, a landlord could convert their property from a rental to a co-op or condominium as long as they sold 15% of the total units to primary home buyers. Now, landlords need to sell 51% of units. Hence, giving the tenants control of the landlord’s property. The reason for this is to protect tenants from landlord harassment to have them vacate their apartments. Some landlord were aggressive and not following the existing laws prohibiting tenant harassment in rent-regulated buildings. Lawmakers wanted more protections for these tenants by putting them in control of the process. Some people believe that this will have serious negative implications for the future of conversions.

In the past, landlords looked at conversions as a way to turn nonperforming assets into profitable ones. Since operating costs and taxes are rising, there might be economic hardships for the property owners even to the point of deferred maintenance. Deferred maintenance occurs when an owner holds off on repairing old or broken systems due to the high cost of such repairs. This deferred maintenance affects the physical appearance and stability of the property and will create a trickle-down effect to other industries like legal, accounting, construction, brokerage and advertising. If the property owner has a small portfolio, this can mean serious economic hardship in regards to their investments.  

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In NYC, there are a lot of older buildings that require major capital improvements and upgrades. When a landlord converts a building, he or she will improve the building while reducing its carbon footprint. Without these conversions, most upgrades might stop and it might cause the properties to fall into further disrepair. There can also be environmental concerns as well because these older buildings do not have efficient heating systems, new windows and new roofs. This might have a negative impact on the environment.

However, there may be exceptions to these new rent laws and the state attorney general will need to make guidelines to approve certain rental conversions. Perhaps there can be a financial litmus test regarding economic hardships on the landlords and if there is a financial hardship, then the landlord might be able to convert it.  We do not know what this new law will bring. It can bring many beneficial changes because the tenants might be more vested in their buildings knowing that they cannot be easily kicked out. Landlords and tenants should be able to bridge the gap and work together to do what is right for both sides.

With over thirty years of experience, All Area Realty Services is well versed in the laws and regulations that can effect co-op boards and condo associations.  With our guidance and advice, our client's can trust that we work with them in safeguarding them at all times. 

Topics: Co-Op Board

Who Is Responsible For A Leak?

Posted by All Area Realty Services Team on Jul 17, 2019 2:24:17 PM

Who is responsible when a leak occurs in your bathroom that a previous owner remodeled? Who would be responsible for mold, if there is any?

To figure out who would be responsible, you need to look at the source of the damage to the bathroom. Start by testing where the water is coming from. If it is coming from the part of the wall, which is attached to a common area, then the co-op board should pay for the investigation or allow the owner to test where the water is coming from at his or her expense. It depends on where the leak is and whose wall it seems to be coming from.

iStock-921346082Once the inspection occurs, if it is found that the ultimate source of the water is coming from a common area of the building, then the board should pay to fix the problem and should reimburse the shareholder for the testing and the damage including any mold. If the water leak is coming from the shareholder’s wall, then the owner should pay.

If you serve on a co-op board and need professional property management services, contact All Area Realty Services and find out why our over 30 years experience and loyal clients makes us experts.

All Area Realty Services is New York City’s leading real estate management company specializing in full-service property management for cooperative and condominium boards in the Manhattan area. 

 

Topics: Co-Op Board, Renovations

Will It Be A Co-op Or A Condominium?

Posted by All Area Realty Services Team on Jul 2, 2019 5:09:39 PM

NYC co-ops are different from condos. When you own a co-op, you do not own the physical apartment but instead you own shares in a corporation and you receive a proprietary lease on the unit. When you rent a co-op, you are subletting the apartment from the shareholder who holds the lease. Here are some questions to ask yourself when planning on renting a co-op.

When subletting, check the building’s sublet policy. It may put restrictions on how long you can stay at the apartment. The rules vary by building but most buildings allow sublets for a maximum of 2 years. If you want to stay in an apartment for longer, renting a co-op might not be best.

Be prepared to fill out an application for the co-op board and to interview with them, if you are looking to sublet in a co-op. If you sublet a condo, you just need to pass a basic credit check and verify your income.Screen Shot 2019-03-14 at 4.04.33 PM

Rules can be quite strict in a co-op building. The rules can focus on noise levels, pets, and other things that ensure a quiet living situation. There are also overall policies of the building and these can change if the board wants to change them. These potential changes can be about the sublet policy and then you might not be able to keep renting the unit.

There will be additional fees that you need to pay to the co-op. These fees may include a move-in, move-out or an application fee. Co-ops may require that the owner pay additional maintenance if there is a sublettor. Most times, this fee is included in your rent but if the fees change, the owner may try to increase your rent to include the additional fee. Ask if the building charges extra fees for sublets.

Make sure to ask about the pet policy of the co-op. Most co-ops have a pet policy in place and these policies are specific about the size or weight and the number of pets per unit. Sometimes, the board will ask to meet your pet. The majority of co-ops just ask that a form be filled out saying that your pet is vaccinated and meets the building requirements. Double check that the pet rules apply to sublettors.

All Area Realty Services is New York City’s leading real estate management company specializing in full-service property management for cooperative and condominium boards in the Manhattan area.

 

Topics: Buying a Co-Op, Buying a Condo

Considering A Property Management Company?

Posted by All Area Realty Services Team on Jun 27, 2019 2:40:14 PM

Are you looking to hire a property manager? What are a property manager’s responsibilities? Their responsibilities vary based on the type of property they are managing, the amount they are paid and the terms of the management contract.

A property manager’s has the responsibility to collect rent from tenants. They will set up a system for collecting rent, which includes the date rent, is due and collecting late fees if the tenants are late with payment. A property manager may determine the correct rent to be charging to get more tenants to your property and to increase your returns. They may also adjust the rent if they feel it is necessary.

Another responsibility is to manage the tenants. This includes finding and screening potential tenants, managing the day-to-day complaints, maintenance issues and tenant move outs. In order to find tenants, property managers will advertise by having an ad that will attract tenants. Once there is a tenant, the property manager should have a screening process that includes credit checks and background checks. A great property manager will have the experience and knowledge about finding and attracting the right tenants. They set the lease term and determine the amount of security deposit required. Once a tenant decides to move out, the property manager needs to inspect the unit to check for damages and to determine what portion of the security deposit to return.

The property manager is responsible for maintaining the property. This includes regular maintenance, emergency repairs and upkeep of the grounds. They hire contractors if they cannot handle the repairs themselves.

A property manager should be well versed in landlord tenant law. This is important when dealing iStock-841723220with screening a tenant, handling security deposits, terminating a lease, evicting a tenant and complying with property safety standards.

Property managers are responsible for managing the other employees at the building and making sure they are doing their jobs properly. A property manager may be hired to watch vacant properties to ensure there are no vandals and to perform routine maintenance.

The property manager is responsible for the budget of the building and must operate within the budget. They also keep the records for the property, which includes all income and expenses, inspections, signed leases, maintenance requests, records of repairs, costs of repairs, rent collection and insurance costs.

Lastly, a property manager needs to be able to assist the owner with understanding how to file the taxes and then the property manager may also file the taxes for the property.


All Area Realty Services knows what it takes to run buildings smoothly and efficiently while keeping both tenants and owners happy.  With over 30 years of experience, and many clients with All Area Realty Services for decades, All Area can be trusted with taking care of your building and tenants. 

Topics: Co-Op Board, Property Management, Condo Board Association, property manager