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The Maisonette Apartment in New York City – What It Is & What It Isn’t

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The NYC real estate market is incredibly nuanced, especially when it comes to apartment types. Through the course of our podcast and articles we’ve written, we’ve covered many different apartment types, but today, we’re covering another ground floor offering – the maisonette apartment.

What is a maisonette apartment in Manhattan?

Technically speaking, a maisonette is a first floor apartment in a multi-unit apartment building with a private entrance from the street. Some New York brokers will expand the definition to include first floor apartments with an entry directly off of the lobby.  

This basic definition of the term maisonette leaves a little information to be desired, though. What is the origin of the maisonette? Where can you find maisonettes? What are the pros and cons of purchasing a maisonette? We’ll cover all of that and more in the rest of this post.

Would you rather watch than read? Click the link below to play our episode about maisonettes!

Classic Characteristics of a Maisonette Apartment

Maisonettes are technically defined as first-floor apartments that are part of a larger apartment building that come with a private entrance from the street. But, as with many things in New York real estate, agents also use the term for other types of apartments along the same vein.

Agents may also use the term maisonette to refer to:

  • Apartments that have a ground floor entrance off the lobby, but there’s not a separate entrance from the street.
  • Apartments that are up a few stairs (not flights), but there’s still an entrance directly from the lobby, and you don’t have to take an elevator to reach the apartment.
  • Apartments that have an entrance from both the lobby and the street (this is actually the most common format for a maisonette).
  • Apartments that have an outdoor space. In other words, maisonettes CAN be garden apartments, but they don’t have to be.

Listen to our podcast about maisonettes at the link below!

maisonette apartment interior

History of the Maisonette Apartment

Merriam-Webster defines maisonette as “small house”, which comes from the original word in French. The maisonette apartment was likely nicknamed little house due to their larger layout and private entrances that give the space a more single-family-home feel.

With that being said, many maisonettes were originally office/retail spaces or live/work spaces. That original use often carries over in slightly more flexible usage for its owner, making this type of apartment popular among doctors, psychiatrists, etc. The live/work space can be divided by floor (yes, some maisonettes have two floors!) or into two parallel spaces by different entrances.

Where Are Maisonettes Commonly Found?

If your heart is set on a maisonette apartment, you’re going to have to hunt thoroughly, as they are rare! With that being said, a great real estate agent or team (like The Gasdaska Conlon Team!) can help you find whatever apartment you are looking for, whether it’s a maisonette or another type of apartment.

Generally speaking, you’re more likely to find a maisonette apartment in a pre-war building on the Upper East Side, Upper West Side, or in the West Village. Some new construction maisonettes exist in Cobble Hill, Park Slope, and Williamsburg as well.

open concept maisonette apartment interior

You Should Purchase A Maisonette Apartment If…

You’re searching for a luxury property, not just another apartment. Maisonettes are often considered as high-end as penthouses, though the luxuries these homes offer can differ quite a bit. With your own private entrance, larger floor plan, and a layout that is more unique than the rest of the units in that building, a maisonette apartment is absolutely a great choice for certain buyers.

Your household desires a bit more privacy. Apartment living comes with a lot more visibility when it comes to neighbors and building staff. When you buy a maisonette apartment, you can come and go as you please with a bit more privacy since you won’t be restricted to entering your home through the elevator or the lobby. The private entrance makes the home feel a bit more separated, more like a townhouse.

You have a larger household. Maisonettes are typically a bit more spacious than other types of New York apartments due to the original use of the space. That means that each room feels larger AND you can expect more bedrooms and flex space. If there will be a larger number of people living in the apartment with you, or you just want a little extra space, a maisonette apartment can be an attractive choice.

You want a private backyard or garden. Outdoor space is highly sought-after in Manhattan, and the prospect of a private green space even more so. Many maisonettes are like townhomes or garden apartments in that they often come with access to such space.

Your household enjoys the amenities of apartment living. The amenities and common utilities of apartment buildings are fantastic. However, having to share elevators, laundry, trash chutes, or a lobby with every other resident in the building isn’t ideal for every buyer. The maisonette apartment is the perfect midpoint between an apartment and a townhome. You get to enjoy the amenities you choose to share while also retaining a little more privacy than you’d get with a traditional apartment.

Stay Away From A Maisonette Apartment If…

You’re sensitive to loud noises. Being on the street level does come with some drawbacks, like hearing car horns, construction noise, and sirens more clearly. Sure, it’s possible to renovate the home to include sound proofing, but there’s only so much that can be done to mitigate the noise. Especially if you have a lot of windows in the space. 

Your dream home includes a skyline view. If it’s at all important for you to have a breathtaking view of the city around you, don’t go for a maisonette apartment – since they are most often located on the ground floor, you will get a street view, not a sweeping skyline view.

You want a home flooded with natural light. When you’re surrounded by high-rise apartment buildings and you live on the ground floor, it’s hard to get sun exposure on your windows. Most of the natural light that does come in will be bouncing off of and diluted by the surrounding buildings, especially if your maisonette is in the back of the building.

You are afraid of the occasional pest. Another annoyance that comes with living on street level is that you’ll be more likely to deal with rodents and pests. These creatures often seek refuge in ground level apartments, no matter how luxurious they are, because of their proximity to the food and water they scavenge on the street. It’s nothing that having a good exterminator on call can’t fix, but if you are especially mouse or rat phobic, be warned!

Now You Know!

Armed with everything you needed to know (and maybe a little bit more) about maisonettes, it’s time to get out there and start searching. Whether you choose to go the maisonette route or not, the Gasdaska Conlon Team is here for you.

Ask any questions, voice any concerns, or just use us as a sounding board. We’re happy to assist you and your household to make savvy decisions in residential real estate in New York City.

Putting Less Than 20% Down In NYC – The Hard Truth

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Achieving the dream of owning a piece of NYC can be difficult without a substantial down payment on hand. If you talk with a mortgage banker, buyer’s agent, or even friends who have made the leap from renting to owning, you’ll hear one thing over and over: how typical, and in most cases required, it is to put at least a 20% down payment on your apartment purchase.

But is that REALLY necessary? Or can you get away with putting down less than 20% in NYC?

Unfortunately, it’s just not realistic to purchase an apartment in Manhattan when putting less than 20% down on the property. Having that little equity in your potential property makes you look like a risky candidate for lenders, sellers, and the building’s board, so the likelihood of rejection is high.

But isn’t this common practice outside of the city? Why is New York City different? In the rest of this article we’ll dig deeper into the practical reasons behind this threshold, the down payment minimums in average condo and co-op buildings, and why sellers are wary of accepting offers with less than 20% down.

Why A 20% Down Payment Is Standard In NYC (The Higher The Better)

moving into a new apartment with less than 20% down

Private Mortgage Insurance (PMI)

If you put less than 20% down, you are going to have to pay Private Mortgage Insurance, or PMI. This type of insurance exists to protect your lender if you come up short on your monthly mortgage payment at any time. And this isn’t just a Manhattan thing – it’s typically required on any conventional mortgage where the lender has less than 20% of the purchase price to put towards a down payment, no matter where you live.

The problem with PMI is that it is EXPENSIVE. Private mortgage insurance is usually 0.5%-1% of the total loan amount, according to NestApple. So if you’re borrowing $500,000 and put down less than 20%, your PMI payments would be an extra $5,000 a year. These payments are made monthly in addition to your mortgage payments. 

You can remove this insurance and its payments eventually… when the loan balance reaches 78% of the principal of the mortgage with no late or missed payments. While PMI can help you to keep more liquid assets in the bank instead of putting all of them into a down payment, it increases your monthly costs significantly.

Co-op boards are also much less likely to approve any financing that requires PMI because it’s an additional risk to the building. They are there to protect the value of the building, and they don’t want to take the risk of someone not being able to pay.

Strict Building Requirements

Whether you’re trying to buy into a condominium or cooperative building, there will be a minimum down payment required by the board. While this can seem unfair at first, the building has every tenant to consider. 

Cooperative Down Payments

In most co-ops, the building will not accept less than 20% down payment. It’s not uncommon for some co-ops to require 25-30% down, and in higher-end buildings, financing may not be allowed at all. 

Additionally, after the down payment, co-op boards also want to see proof of financial stability long-term. They usually want proof that members will have liquid assets to cover a specific range of time (usually a minimum of 12 months) of expenses after closing, but can also be as high as a multiple of the purchase price. 

Again, we know this can add stress to what is already a large purchase, but it’s all about what’s best for everyone in the building. Being able to weather a job loss, unexpected medical expenses, or other financial emergencies while still covering the mortgage and monthly fees for the building ensures that everyone involved is protected.

Condominium Down Payments

While condominiums are known for their flexibility and relative hands-off management, they often still have down payment expectations by developers (if new construction) or the seller themselves (if resale). A 20% down payment is still the minimum expectation for most buildings. 

Some condo buildings may not explicitly state a minimum, opting to use language like “no more than a maximum of 80% financing”, which amounts to the same exact stipulation. 

It’s true that these are not as inflexible as cooperative down payment requirements, but it’s still extremely difficult for a buyer with less than 20% down to negotiate. Regrettably, the common perception is that buyers who cannot afford to put a 20% down payment on an apartment are a high risk for sellers and developers alike. 

saving up for a 20% down payment

Federal Housing Authority (FHA) Housing and Loans

The Federal Housing Authority does have some ability to help households with less than 20% down to purchase homes. They also offer a rent-to-own type program where FHA repossessed homes and apartments are rehabbed by organizations like Habitat for Humanity or Restored Homes and then sold to the tenants through the New York City Housing Authority (NYCHA).  

The reality is that there is an incredibly small number of these loans and homes available in New York City, and even less in Manhattan. The FHA loans are extremely competitive and have maximum credit scores and yearly income in order to qualify. NYCHA’s rent-to-own program was established 35 years ago, according to their site, and they report they’ve “helped more than 300 NYCHA residents become homeowners of FHA homes.”

That’s 300 people out of the just over 8 million people who live in New York City.

So, while there are options that could help if you don’t have a 20% down payment, there are far more applicants to those programs than successful recipients.

Competition From Other Buyers

If you’ve rented in the city you know exactly how tough it can be to find and get approved for an apartment. Buying an apartment in New York City can be even more difficult, especially if you have less than 20% down for the purchase.

No matter the state that the market is in, it’s unusual for your offer to be the only offer on any given apartment. When putting a minimum of 20% down payment on a home is the norm, offering less than that makes you a much less attractive buyer – even if you have a stellar rental history and your credit is impeccable.

Sellers are going to gravitate towards the offers that seem the least likely to fall through because that is their right. When you have a down payment of less than 20% of the purchase price, you are fighting a steep uphill battle against multiple offers that include a 20% down payment or higher, and a potentially higher sale price. 

In Conclusion

Although there may be programs or loopholes that can technically allow you to purchase an apartment in NYC without putting around 20% down payment, the reality of the situation is that it is almost impossible to do. While we of the Gasdaska Conlon Team normally prefer to be optimistic and encourage our readers to explore their options, we don’t feel comfortable putting any kind of spin on this situation. 

If you’re not in a position to put a 20% down payment on an apartment AND have at least 6 months of expenses in liquid assets after the closing of the home, you aren’t in a position to safely buy a home in Manhattan. We strongly recommend continuing to work hard and save until you can put 20% down without jeopardizing your household’s financial stability.

Sponsor Units – What Are They & Why Are They SO Desirable

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One of the more unique to Manhattan apartment types are sponsor units. But what is a sponsor unit in New York City? And what makes them so special?

Generally speaking, a sponsor unit is an apartment that has never been sold. New York City brokers define sponsor units as rent-controlled apartments in converted co-op or condo buildings that weren’t sold during the initial conversion.

In this article, we’ll cover a short history of the conversion wave of the 1970s and 1980s, the pros and cons of buying a sponsor unit, how the purchase process compares to buying a traditional resale condo or co-op, and why the term isn’t used to describe new development sales.

Everything You Need to Know Before You Shop For A Sponsor Unit in New York City

A Brief History of How Rent-Stabilization and Rent-Controlled Apartments Caused Conversions

In the 1970s and 1980s many NYC residential rental buildings were converted to condominiums or co-ops. This wave of conversion was mainly due to the effects of a rent stabilization law that was enacted in 1969 (though there were certainly other microeconomic and macroeconomic factors that go beyond the scope of this article).

Unfortunately, the apartment’s stabilized rent rates just couldn’t keep up with the market value as the apartments appreciated with time. 

Since landlords couldn’t raise rent (and more often than not were having trouble making ends meet due to the stabilization laws), many decided to convert their buildings and sell the apartments. This let them get around rent regulations and recover some of the financial losses that those regulations had caused.

Landlords listed their apartments for sale and offered tenants discounted pricing to incentivize them to purchase – it was a win-win for both parties.

Landlords could make more money than if they continued to rent at stabilized rates, and tenants became homeowners at around half the market rate compared to if they purchased a non-sponsor unit. As a result, buildings were converting left and right.

the perks of a sponsor unit

Why There Are Still Sponsor Units Available After the Conversion Wave of the 70s and 80s

What happened if a tenant didn’t want to (or couldn’t) purchase their apartment? Well, they had a right to stay due to non-eviction conversion laws – and that means their apartments would continue to be rent-stabilized.

As with anything in NYC housing, there’s a lot more nuance to it than simply ‘they got to stay’…but for the purposes of this article we are focused on how it affects modern-day transactions.

If you are interested in the history, the New York Fed wrote a piece about the co-op conversion wave in 1980 that’s a surprisingly good read.

Most of the time the sponsor/developer/landlord in this situation can do nothing but wait until the tenant moves out, which can take years because family members can pass down rent-stabilized apartments to one another. For this very reason, there are still many rent-controlled apartments in the city today.

Just like in the 1970s and 1980s, as building costs and taxes rise, the original owner of the unit loses money on the rent controlled apartment. The original owners usually cut their losses by selling their rent-controlled apartments to mega-developer sponsors, who have a large enough portfolio to sustain long-term losses until the apartment can be sold.

There are a number of mega-developers in Manhattan who have turned this into a business. They essentially buy the unsold shares of the co-op, wait for the rent-stabilized tenants to move out, then flip the apartment and list it as a sponsor unit.

Aren’t New Developments Technically Sponsor Units?

New developments are technically sponsor units, but NYC brokers don’t refer to them as such – they’re just called new developments.

If you see sponsor unit anywhere in a listing, it’s referring to the first-time offering of a rent-controlled apartment in a converted co-op or condo building that wasn’t sold during the initial conversion.

sponsor unit

Perks of Buying A Sponsor Unit

There are advantages to purchasing a previously unowned apartment in an established condo or co-op. These advantages can be attributed to two factors: the origin of the apartment and the different requirements these purchases are subject to.

  • No board approval required: When purchasing a non-sponsor unit in a co-op building, buyers are required to be approved by the co-op board. This is to ensure they are financially sound and would make good neighbors. In a sponsor unit sale however, you have the opportunity to buy into a co-op building without having to be approved by the board. Note: any subsequent buyers of the apartment will be subject to the usual board approval process.  
  • Some financial advantages can be had: If you are self-employed (or have other non-traditional income streams) and, despite high levels of income, you’re struggling to show that you can actually afford real estate, sponsor units can be a great way to purchase NYC property. Additionally, you may be able to save some money when it comes to the down payment because you are free of the board’s requirements. 
  • Quicker closing time: Yet another perk of skipping the board approval process is that you can expect to close about a month sooner than you would in a typical co-op purchase. 90 days is a typical timeframe for that process, but it’s much faster when you’re not dealing with the board.
  • Utilitarian updates will be made: A sponsor unit that has been occupied by a tenant with rent control for years often needs a lot of TLC. While you shouldn’t expect a full cosmetic flip, the sponsors of such units usually update aging electric, water, or heating systems. So while the rest of the unit may be sold in “original” condition, you can usually rest assured that those big ticket items have been modernized. 

Downsides of Buying A Sponsor Unit

Unfortunately there are also disadvantages to purchasing a previously unowned apartment in an established condo or co-op. These disadvantages mainly come from the history of the apartment and how the costs of a sponsor unit add up.

  • They’re often sold in “original” condition: While it is true that absolutely necessary updates to electric, water, and heating systems and a fresh coat of paint will usually be done to a sponsor unit…the updates usually stop there. Appliances, trims, moldings, light fixtures, and sinks/tubs/toilets will usually be outdated. This means that most sponsor units need significant renovations before they’re up to the average New Yorker’s standards. These renovations will be expensive and subject to the co-op board’s approval.
  • You will likely pay more up front: Sponsor units typically sell for more than their resale co-op counterparts, because people will pay a premium for the privilege of skipping the board’s approval. Also, closing costs for sponsor units may be higher than average due to the buyer paying the transfer taxes and for their real estate attorney. If you’re renovating your new home before you move in, that will add to the costs as well. 
  • Rare legal issues regarding tenancy: If the apartment you’re looking to buy was previously a rental, buyers and their real estate attorneys must investigate the termination of the existing lease prior to the sale as part of due diligence. If the lease was not terminated legally, especially if the apartment was rent-stabilized or rent-controlled, you could get caught up in a years-long legal case that’s both expensive and exhausting to deal with.
  • When you resell, your buyer will need board approval: The perks of a sponsor unit sale end with the first buyer. As soon as you take ownership of your new apartment, you are subject to the rules and regulations of the co-op board. And when it comes time for you to sell that apartment, any potential buyers will be too. That means that you won’t get the same premium purchase price that you bought for, and closing on the sale of the apartment will take longer.

How Do Sponsor Units Compare to Co-ops & Condos?

When it comes to the ease of purchase, the flexibility of use, and the average purchase price, think of sponsor units as the midpoint between a co-op and a condo. As the buyer of a sponsor unit, you’ll get to enjoy the same accelerated closing process and lack of board approval that buyers of condos do.

However, when it comes time for you to renovate, if you want to sublet the apartment, or you decide to sell the property, your experience is that of a typical co-op owner. Board approval and requirements apply to all three scenarios.

Ready To Start Apartment Hunting?

If you’ve made it this far, you should know absolutely everything you need to (maybe more) about sponsor units. They’re not for every buyer in New York City, but they are definitely the savvy choice for New Yorkers in unusual financial circumstances or seeking a little flexibility.

Unsure of whether or not a sponsor unit makes sense for your household? Give us a call or send us an email, we’d love to get to know you a bit and see if we can help you figure it out!

What Are Garden Apartments in New York City?

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Depending on where you live, the term garden apartment can mean different things. In some cities, it simply means that you have access to green space, while in other cities it suggests a certain number of stories, amenities, etc. But what are garden apartments in New York City?

A garden apartment in New York City typically refers to a ground floor apartment in a multi-unit building that comes with private access to outdoor green space.

Garden apartments can be a perfect fit if you’re looking for private or semi-private outdoor space, but as with any Manhattan purchase, it’s best to learn all there is to know about the pros and cons of garden apartments before you make an offer on one. In this article, we’ll cover the difference between a first floor and parlor floor, pricing of garden apartments, and the pros and cons of purchasing a garden apartment in NYC.

What You Should Know About Garden Apartments in New York City

NYC-Specific Nuances

As with any market, there is some variety to what agents and brokers call different types of apartments. The technical definition of a garden apartment is a ground floor apartment in a multi-unit building that comes with private access to outdoor green space…but some brokers will use the term garden apartment to refer to a garden-level apartment, even if there’s no private outdoor space attached.

Garden apartment entrances on the parlor level

Garden Apartment Levels – First Floor, Parlor Floor, Etc.

We briefly mentioned this above, but in NYC the ‘first floor’ can actually be one of two floors – the ground floor or the parlor level.

The reason for these two separate floors is the era in which many NYC buildings were built. A large number of NYC garden apartments were constructed in the late 1800s or early 1900s when most transportation was still provided by horse – and with horses comes manure. In an effort to keep the inside of these homes clean, architects added a flight of steps to the second floor (or parlor floor) to enter the home.

Therefore, an apartment that enters into the parlor level of the home that has access to ground-floor private outdoor space is still considered a garden apartment, even though there’s technically a floor beneath the entrance level.

Pricing of Garden Apartments

As with any other apartment type in NYC, pricing depends on a variety of factors.

Location is always one of the biggest pricing factors – the closer to Manhattan, the more expensive things tend to be. Brownstones often come with private outdoor space (though not always) and are highly sought after, resulting in a higher price tag. Renovated spaces, those with more square footage, and those with larger green spaces tend to be priced higher as well.

Another key determining factor for pricing within the garden apartment category is how you actually access the garden space from within the apartment. The most desirable setup is to have direct access from the living or dining space, followed by access from the primary bedroom.

Any other type of access, like through a secondary bedroom, tends to fetch a lower price – and it’s easy to imagine why. If you have kids or company sleeping in a bedroom that you need to walk through to access your private outdoor space, you’re much less likely to be able to use it without disturbing someone.

garden apartments in park slope

Pros of Purchasing A NYC Garden Apartment

Garden apartments already come with one huge advantage over many apartments in New York City – outdoor space. But they are certainly different from those with terraces or rooftop decks, and there are a few less obvious benefits that are important to take into consideration when apartment shopping. 

1. They’re Easily Accessible

If you choose to buy or rent a garden apartment, moving in is a breeze. You can say goodbye to the days of carrying boxes and heavy furniture up many flights of stairs or dealing with elevators. The same can be said for everyday access – there’s no waiting for an elevator or climbing up countless steps to enter your home.

2. They’re Great For Pets

If you’ve ever lived in a high-rise apartment building in New York City with a dog, you know how difficult it can be to time bathroom breaks. In a garden apartment, you can let your furry friend out the back door off leash to sniff around to their heart’s content.

3. They Tend To Be Quiet(er)

NYC is not a quiet place – but any New Yorker already knows that. You’ll likely always hear sirens, horns, and alarms if you live in the city. But if you’re looking for more solitude, garden apartments may be a perfect choice. These homes tend to be quieter for a variety of reasons: they are lower to the ground and therefore better insulated from sound, the larger buildings that surround them absorb some of the sound as well, and they tend to be built in more residential areas that simply don’t generate as much noise as the high-rise parts of NYC.


Cons of Purchasing A NYC Garden Apartment

While it’s true that there are many reasons to move into a garden apartment in New York City, there’s also a few good reasons not to. It really just depends on your household’s priorities and preferences.

1. No Sweeping Views

Part of living in NYC is appreciating it from above – there’s something magical about watching a Manhattan sunset bathe the city in golden light. Because of their height relative to the buildings around them, garden apartments are not known for their breathtaking views. Being halfway below grade, the windows you do have typically look out at street level – so you may get to know your neighbor’s shoes well.

2. Rodents and Pests

It’s no secret that NYC has more than its fair share of rodents and pests – it’s inevitable anytime there’s a huge number of people living close together. But since garden apartments mean you are closer to the ground, you’re more likely to encounter unpleasant guests more often than if you were higher up in a high-rise building. This is especially true if there’s nearby construction – it’s very common to hear about an uptick in rodent and pest sightings if a building in close proximity is undergoing work.

3. Staging for Construction

Extra critters aren’t the only concern that comes along with construction – if you own a garden apartment, you might even find your private outdoor space become a staging area. Often the building actually has final say of who gets to use the private outdoor space, even if you ‘own’ it. This is actually something that can happen with private terraces, too.

Enjoy A Little Slice Of The Great Outdoors In A Garden Apartment

Now that you’re familiar with the pros and cons of owning garden apartments in New York City, you can get on with your search for your new home. Visit Corcoran’s website to get a glimpse of the available garden apartments in New York City. 

Whatever type of apartment you choose to go with, it’s important to have quality representation in the form of a knowledgeable and seasoned expert real estate broker. 

Contact the Gasdaska Conlon Team for help buying or selling apartments in Manhattan, no matter the size or location. We work tirelessly to provide the greatest value possible for all our clients. Let us show you how.

8 Insightful Co-op Board Interview Do’s and Don’ts

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So, you’ve got a signed contract and have meticulously presented your personal and financial history to the co-op board in the form of your application. The next step can be incredibly nerve-wracking (though it doesn’t have to be) – the co-op board interview.

As expert NYC real estate agents, we’ve had countless clients go through the board interview process and have put together a few tips that can make the experience a bit easier. With these co-op board interview tips, you’ll be fully prepared to ace the co-op board interview and move into your new home in no time.

Co-op Board Interview DO’SCo-op Board Interview DON’TS
Sanitize your social media presenceCome unprepared
Dress for successBe surprised if they ask for a pet interview
Do your researchAsk questions
Plan out who will answer what questionsVolunteer information without being prompted
Be on timeBoast or sell yourself
Stay presentTalk too much
Be yourselfMention renovations
Thank the boardExpect an answer at the end of the interview

How to Pass Your Co-Op Board Interview

What is a co-op board interview?

The co-op board interview is the final step in obtaining approval from the co-op board to purchase an apartment in that building. 

Co-op board interviews are key to a successful closing on a cooperative apartment because the board wants to make sure you’re a good fit for the building. Their primary goal is to protect their building by assessing if you’re neighbor material or a bundle of red flags.

No two co-op board interviews are exactly alike. Some are formal conference room affairs and others are informal gatherings in one of the board member’s living rooms. Some provide the opportunity for the board to decide on your financial standing and personality, while others are scheduled to vet your personality following conditional approval of your financials.

For some sample co-op board interview questions, check out this article.

No matter the process or the setting, we’ve come up with a foolproof list of Do’s and Don’ts that will make your next co-op board interview a piece of cake.

how to ace your co-op board interview

During Your Co-op Board Interview, DO:

  • Sanitize your social media presence – It’s almost a given that some (if not all) of the members of the co-op board will Google you before the board meeting. Which makes how you appear on social media and websites extremely important. 
    If you can, the easiest way to do so is to make your profiles private on every platform. If you can’t, manually review public posts, comments, and tagged photos or videos. Delete, privatize, edit, or untag yourself from anything offensive or polarizing on hot-button issues. 
  • Dress for success – Regardless of how formal the interview is (or isn’t), you should present yourself carefully. Choose business casual attire. This dress code hits the sweet spot between looking like you care too much or like you don’t care enough. The board may not be in the same attire or be much more casually dressed than you are, but they’re already ‘in the club’. You still have to earn your spot.
  • Do your research – Ask your broker for insight into the co-op board members. If they’ve transacted on an apartment in that building before, they may be able to provide you with useful information. Be very careful with this step, because it could be easy to be too familiar with the board and appear creepy.
  • Plan out who will answer what questions – If you are purchasing the home with a partner or spouse, decide ahead of time who will speak on certain topics or answer certain questions. This will help you avoid talking over one another and ensure both of you get to speak an appropriate amount. Additionally, it reduces the amount of prep you each have to do!
  • Be on time – This one seems simple but it is absolutely key. Co-op board members are people with busy lives and schedules just like you. They’ve taken the time out of their day to be there to speak with you – don’t waste a second of it.
  • Stay present – While it may be exciting to be meeting some of your potential new neighbors, try not to get caught up in the excitement. This is still an interview, not a social call. Even if you are clicking really well with some of the board members, stay focused on the task at hand.  Keep your professional and polite demeanor up (at least until the interview is over and you close on your apartment).
  • Be yourself – Co-op board interviews usually last 20-30 minutes, so they’re over before you know it. While we encourage you to keep your replies brief and on-topic, we also strongly encourage you to let your inner light shine! The co-op board wants to see who you are and what you’re about, so let them in a little. If you’re too nervous or closed off, it could impact the interview negatively.
  • Thank the board – When the interview comes to an end, be sure to thank the co-op board members for their time. It’s the polite, professional, and considerate thing to do. Plus, it demonstrates courtesy and kindness- which are ideal neighborly qualities.
what not to do in your co-op board interview

During Your Co-op Board Interview, DON’T:

  • Come unprepared – While you don’t need to bring a copy of your application and financials to the interview, it is important to remind yourself of the contents of the package. It’s good to refresh your memory on the information contained in the personal and business reference letters you submitted, as the contents of these letters provide a more personal way to connect with you.
    Also, be prepared to talk about your money and your personal life. While it is usually taboo to get into these topics with complete strangers, in a co-op board interview, both lend valuable insight into the kind of neighbor you are. The board members don’t need to know your full life history, but answering their questions openly goes a long way.
  • Be surprised if they ask for a pet interview – If you are bringing a furry friend into the apartment building, many co-op boards will require a pet interview. This is especially important if there are other animals on your floor, to ensure everyone in the building still has some peace and quiet. 
  • Ask questions – Unlike a job interview, a co-op board interview is not an opportunity for you to determine if the building is a good fit for you. You’ve already done that, by making an offer and submitting an application to the board. This meeting is all about allowing them to get to know you and your partner or spouse, so it’s important to let them steer the conversation.
  • Volunteer information – As a general rule, you want to answer the questions asked of you and nothing more. You’ve only got 20-30 minutes to make a good impression, so stay focused on what the co-op board members decide they need to know.
  • Boast or sell yourself – Even if you are really proud of the massive commission you earned this year, don’t bring it up unprompted. If it does come up, perhaps in reference to your financials, stick to the facts of the situation. Being boastful isn’t a desirable trait to most people, so don’t exhibit it to the co-op board members if you can help it. 
  • Talk too much – As we mentioned earlier, co-op board members are busy New Yorkers, just like you. Show them that you respect them and their time by answering their questions concisely and getting to your point quickly. You don’t want to accidentally talk yourself out of an acceptance.
  • Mention renovation plans – Definitely don’t get into your renovation plans for the apartment unprompted. If a board member asks you point blank, it’s important to minimize or speak vaguely about your plans – even if you know you’re going to gut the home to the studs. Renovations are a hassle for your neighbors as well as yourself, after all.
  • Expect an answer at the end of the interview – While in some cases you may get a verbal acceptance at the end of the interview, that is absolutely not the norm. They’ll let you know whether you were accepted or rejected in writing via the managing agent of the building, usually the following business day after the interview takes place.

Armed with these Do’s and Don’ts of co-op board interviews, you should be all set to gain acceptance and move into your new home! We hope you love it. And if you are interested in buying or selling property in NYC – we’re your team. Reach out here for more info or to get started!

Land-lease Buildings in New York City – What’s The Appeal?

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The New York City real estate market is like no other in the world. There are tons of niche quirks and unusual types of purchases that can be daunting to those who aren’t familiar with NYC real estate terminology. One extremely common question we hear is this:

What is a land-lease building in New York City?

A land-lease building is a building that doesn’t own the land it sits on. Instead, the building rents the land from a separate landowner, who retains ownership of a parcel of land but leases the building constructed on it. Land-leases are typically around 100 years in length at their inception.  

Transacting on apartments in land-lease buildings comes with a few unique hurdles to jump through. For most buyers (especially if they aren’t working with a NYC real estate broker yet), it can be difficult to tell if a building is a land-lease or not, and even more difficult to track down who the landowner is. 

Read on to learn the pros and cons of owning an apartment in a land-lease building, what happens when the land-lease expires, and what you can expect from your lender should you make an offer on a land-lease home.

If you’d rather listen along, we have a podcast episode all about land-leases! Tune in below.

A Comprehensive Guide to Land-lease Buildings in New York City

What Exactly is a Land-lease Building?

While the definition above captures the gist of what a land-lease building is, there is a little more to it than that. For starters, land-leases are also sometimes referred to as ground leases. 

These buildings make up a tiny percentage of the apartment buildings in New York City – and most of them are sprinkled throughout the city with a few exceptions such as Battery Park City, which is entirely on a land-lease from the Port Authority and warrants a separate discussion altogether. 

They’re also usually set up as cooperatives rather than condominiums. If you happen to find a land-lease co-op, know that they typically do not have to pay property taxes because they rent the land vs. own it.

Because the land beneath it is leased by the building, a portion of the monthly maintenance fees owed in a land-lease building is the land rent that everyone in the building contributes towards. This makes the monthly fees higher in land-lease buildings. The asking price of such an apartment is usually significantly lower than market value to compensate.

So, if you see a co-op listed at roughly 20%-30% below market value with high monthly fees, there is a strong chance that it is a land-lease building.  

Tired of reading? Watch our podcast episode about land-lease buildings at the link below!

Perks of Land-lease Buildings

While land-leases definitely have some unique drawbacks compared to traditional co-ops and condos, there are also some perks.

  • The biggest perk in a land-lease building is that a buyer will get more square footage for their dollar.
  • Given that most land leases are legally structured as co-ops, a buyer also avoids two of the larger closing costs paid in condo transactions – title insurance and the mortgage recording tax.
  • Although structured as co-ops, most land-lease buildings are governed by condominium type by-laws, allowing for more flexibility in ownership as well as the option to sublet the apartment immediately.

The flexibility of ownership and the significantly lower purchase price and closing costs may not seem like a good enough deal in comparison with the monthly maintenance fees – but for some, it could make sense financially.

Doing the math on a land-lease apartment, especially over the period of time you expect to own it, might surprise you. Savvy New Yorkers and their brokers know that sometimes the best deal out there is a land-lease – because most potential buyers won’t even consider it. That can make the sellers a little more flexible when it comes to negotiations.

When considering an offer on an apartment in a land-lease building, make note of how long is left in the lease. If there’s decades to go before it expires and you and your broker agree the math makes sense, it could be a great investment.

Drawbacks of Land-lease Buildings

Ultimately one of the most influential drawbacks of buying in a land-lease building is that you are still paying rent monthly, albeit just for the land instead of the apartment itself. That money you spend each month doesn’t go towards any capital improvements and there aren’t any tax deductions you can take to compensate for it.

The lower market value of apartments in land-lease buildings may be attractive when you’re a buyer, but when you become a seller it becomes more of a negative. As a seller of a land-lease, you have a smaller segment of New Yorkers who will actually consider the purchase, and they usually require a good amount of education along the way.

This combination can result in your apartment sitting on the market for a while, which can impact your bottom line. Additionally, if you will own the home as the land-lease gets closer to expiration you may be in for some serious complications, including having trouble finding a lender if you’re financing.

What Happens When a Land-lease Expires?

Most of the time a building and the landlord are able to negotiate a renewal of the land-lease decades before it expires. This is especially true in cases where local governments are the land-owners, such as in Battery Park City. 

The Battery Park City Authority manages the land-leases in Battery Park City, and they are a nonprofit organization with the express purpose of maintaining and improving the neighborhood. This community-driven instead of profit-driven approach makes them incredibly motivated to negotiate lease renewals.

However, in rare cases, usually involving private landowners, the land-lease renewal negotiations are not successful. If there is no lease renewal, then ownership of the land, building, and any improvements immediately revert back to the landowner.

Yes, you read that right.

The risk of this nightmare scenario exists with all landlords, but especially with private landowners. And because of this, in the event a renewal cannot be negotiated, the value of an apartment in a land-lease building gradually decreases to $0 by the end of the lease. 

In some cases, building owners have been able to buy the land from the landowner. Ultimately, this doesn’t lower costs for building residents. Effectively, all you do in that scenario is swap your monthly land rent for a mortgage OR fork over a lot of cash up front for the purchase. 

land-lease buildings

What Are the Different Types of Landlords of Land-lease Buildings?

What happens as the land-lease on a building draws to a close is greatly influenced by what type of landlord owns the land under it. There are three main types: government, non-profit, and private. We’ve ranked them in order of lowest risk (1) to highest risk (3).

  1. Government – Battery Park City, as mentioned in the previous section, is a prime example of a government landlord. Because BPCA and others like it are a government entity, they do not have to pay property taxes. This means that the monthly land rent can be reinvested into the neighborhood instead of set aside to cover property taxes. 
  2. Non-profit – The Roman Catholic Church and the Episcopalian church are some of the larger non-profits who invest in real estate and lease their land to building owners. Like a government entity, churches and some non-profit organizations also don’t pay taxes, so they too are usually more community driven. 
  3. Private – These landowners are everyday people just like you and me – with their own motivations and goals. Private landowners are typically more profit driven and harder to negotiate with. The land under your building could be sold at the end of the lease without you ever knowing it, until the new landowner decides to hike land rent. Even if the land doesn’t change hands, the end of a land-lease often marks a significant increase in land rent for residents. 

How to Find Out if an Apartment is in a Land-lease Building?

A good real estate broker can help you find out if the apartment you have your eye on is in a land-lease building, and it is important to know the facts before any sort of offer is made or value decided on a property.

Another person you may want to call on before making significant moves towards purchasing a land-lease apartment is your real estate attorney.  A good real estate attorney can investigate and advise you from a legal standpoint and should be relied upon for the nitty gritty sort of information/terms of the lease.

It is important to note that not all land-leases are created equal, so if the general features we discussed make it appealing to explore, rely on experts in your corner to advise you on the ins and outs of the lease in any specific building.

If you’re trying to ascertain whether a building is a land-lease or not before you make an offer, remember what we discussed earlier: Co-ops that are 20-30% below market value with steep monthly maintenance fees are usually in land-lease buildings.

Getting a Mortgage for an Apartment in a Land-lease Building

The easiest way to purchase a land-lease apartment is to pay cash up front. You might be able to secure a loan for the apartment, though. Emphasis on might. It’s important to be aware that your application will face significantly more analysis than a mortgage on a non land-lease apartment.

The first and most important factor your lender will consider is how much time is left in the lease. It will be virtually impossible for you to get a mortgage on the apartment if the land-lease will expire before the 15 or 30 year loan is up. 

It is also much more challenging to build equity on land-lease purchases, because buildings depreciate in value over time while the land they are on appreciates. Lenders take this factor into account when reviewing the risk vs. reward when it comes to your application.

The Mysterious Land-lease Building, Deciphered

If you have further questions about land-leases or other nuances of New York City real estate, send us an email. Whether you become a client or not, we genuinely appreciate the opportunity to chat about the city we love and your place in it.