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A co-op often relates to an employee-owned business or similar community. However, in real estate law, any building owned by a corporation is a co-op. This form of property carries its own set of laws and regulations. The Law Offices of David J. Aronstam help resolve disputes and issues related to owning real estate in New York.
Apartment prices are astronomical in New York, particularly in New York City. Potential homeowners look to keep costs low, especially if they plan on staying for the long term.
When you purchase a co-op property, you are buying stock in the corporation that owns the building. This company then leases the target property to you under a long-term lease. Costs of ownership are as much as forty percent less than that of renting or acquiring a condo.
Co-ops forgo the typical costs of condo ownership. Title insurance is not required, and it is not necessary to pay mortgage recording taxes. It may even be possible to deduct a percentage of monthly maintenance charges.
However, you are not buying the actual property and do not outright own your apartment. This often places the burden of a monthly maintenance fee on the owner. These charges are still much lower than rental or mortgage prices in the city.
Nearly 75 percent of properties in Manhatten are co-ops. Most property owners in this part of the city are part of a corporation.
While many New Yorkers live in a co-op, the elected board sets the standards regarding how the building is managed and who may purchase a unit. Thus, they have a large degree of control over real estate.
The terms of your contract limit what you can do with your share of the property. It is important to remember that you are entitled to a proprietary lease on your apartment and not to outright ownership.
Co-ops help prevent other businesses and investors from owning apartments in a building. Standards set by most boards ensure that property owners live in the space they pay for.
In many cases, officials allow for subletting for a certain time period. Typically, a member can rent their space for several months every two years. You may be required to sell your shares and thus your property if you exceed this amount of time.
In this way, corporations and short-term residents are prevented from obtaining a monopoly on the market and creating further price increases. People prone to transitory stays in any location are highly discouraged from participating in this form of property ownership.
Disputes happen. Co-op leases are contracts entitling you to a part of a corporation. This brings in an entirely different set of laws and regulations on top of those regulating property in the state or city.
Some of the most common disputes involve flexibility in your contract. At times, you may need to leave your residence for a prolonged amount of time. In other cases, maintenance fees may climb, or your local board may impose unreasonable requests.
In any situation, our law offices are available to help. David J. Aronstam started practicing law in 1980 and has an established record.
Get in touch with us today to find out more.
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