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3 Things You Might Not Know About NYC Real Estate
The Real Talk NYC Real Estate Podcast
In this episode, John and Jonathan are covering three things you might now know about NYC real estate – what a pied-a-terre is, what ‘Right of First Refusal’ means, and what a managing agent is.
What is a Pied-A-Terre?
Literally, pied-a-terre means foot to the ground, but New Yorkers use it to refer to a secondary residence in the city. While some buildings allow this type of purchasing in NYC, many buildings prefer to not allow pied-a-terre for a variety of reasons – because they want to increase safety, security, or not allow the building to become a revolving door of short-term guests.
That being said – while the building has a lot of say about whether or not you can purchase a property as a pied-a-terre, once the property is purchased, you can generally do with it as you please. Of course, there are ways that buildings can police this.
What is the Right of First Refusal?
The right of first refusal refers to condominiums only, not co-operatives, and is the only way that condos can prevent someone from purchasing an apartment within their building. However, unlike a co-op that can block someone from purchasing a property, condos that exercise their right of first refusal have to buy or rent the property under the same terms.
For example, if someone wants to sell their $3M apartment to their brother for $500K, the condo can exercise their right of first refusal to purchase the condo for $500K and then turn around and sell it for $3M if they decide the transaction would be detrimental to the building as a whole.
All of that being said – exercising the right of first refusal is not common. John and Jonathan have never seen it done in over 20 years of real estate.
What is a managing agent?
Managing agents are the business arm of building corporations that handle all the financials, transfers, etc., and act as an advisor to the board. They are an incredibly important part of real estate transactions because they have a huge impact on the building as a whole, and their participation is needed in the purchasing process.
Managing agents, unfortunately, are often overworked and underpaid. Our team does our best to treat managing agents well, and it has paid off tenfold.
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