We help clients discover great value in their acquisitions, and navigate all of these complex real estate transactions
The NYC marketplace
Penthouse Condo, 315 Gates Avenue, Brooklyn
New York City home ownership
New York City is unlike the rest of the country where there is an estimated home ownership rate of about 66%. Here the inverse is true. Most people live in rental apartments which comprise about 66% of the overall housing market according to NYU’s Furman Center. Homeowners make up only 34% of the market.
In this supply restricted landscape, there are two dominant forms of NYC apartment ownership; condos and coops. Broadly speaking, condos tend to be the newer housing stock of NYC and account for just 25% of apartment ownership here. The other 75%, or the vast majority of owned homes in NYC, are cooperatives or ‘coops’. These are mostly found in buildings built in the 1980s or earlier, and were typically converted from multi-family rentals built during the last century. Townhouses comprise an even smaller specialty market. Only about 10% of residential transactions in a typical year are townhouses and are a specialty of Peter’s. We help clients discover great value in their acquisitions, and navigate all of these complex real estate transactions.
HOMES IN MANHATTAN & BROOKLYN
New York City apartments
You’ll find that there are two very different flavors of apartment ownership in New York City, a condominium or a cooperative
Condominiums
One York Street, Tribeca, Manhattan, Condo
Condos are real property, just like a house, but you are buying an apartment in a multi-unit building, with a shared ownership interest of the common areas like the amenities, hallways, stairways, etc… They are in demand because they offer buyers maximum control over their property. They may be purchased as investment assets and leased out without the Board of Manager’s permission as required in a coop; nor is approval required for any future resale.
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The flexibility and unilateral control of the property is worth the premium price for condo buyers. It also makes them the foreign and domestic real estate investment vehicle of choice for persons looking for a NYC real estate asset to diversify their holdings. Most new developments today are condominiums and offer a special opportunity to be the very first owner of the home. It costs an even higher premium, but well worth it for those seeking the latest in modern design and technology in their dwellings. Newly built condo units purchased from a developer carry special considerations for buyers too that you can read more about here. Peter works with both investors and those seeking a place to call home.
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Cooperatives
372 Fifth Avenue, Manhattan, Coop Loft Building
Cooperatives may give you the most bang for the buck when looking for a NYC home. Commonly called Coops for short, they are the largest category of apartments available for resale, making up a whopping 75% of the NYC housing market. While many Coops are found in older buildings, many have been updated nicely, or you may bring value to them by renovation. The most important thing to know is that they are intended for your enjoyment as a primary residence only, although some may allow use as an owner’s NYC piéd-a-terre.
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They are not appropriate as investment properties where you will be renting the unit out, as this practice is widely restricted in coops. The buildings are owned by a non-profit corporate entity. When you buy into a Coop, you’re actually buying shares in that corporation; which in turn entitles you to a proprietary lease, for a particular apartment in the building. Your ability to buy into the community will be subject to the approval of the Coop’s Board of Directors. This is referred to by attorneys and lenders as ownership by “Stock & Lease”. Owners are referred to as “Shareholders”. Prospective buyers are called “candidates” and subject to the review and approval of the Coop Board of Directors to purchase. Owners are really proprietary rental tenants in a building which they partially own and operate cooperatively with their neighbors.
The Coop Board is a group of your neighbors, whom usually along with a building management company, has oversight of building upkeep and operations. It has extensive power to grant or restrict what you can do with your unit, including but not limited to sublets, re-sales, and renovations. These rules are in the interest of all shareholders as a community, and will represent a bit of red tape when renovating, re-selling, or buying. They are also a form of ownership that require more owner equity (higher down payments) in a purchase. These higher financial requirements to purchase help assure the financial stability of Coops, and may insulate them during market-wide financial corrections; like in 2008 when Coops proved to be very resilient because of their higher owner equity and strong reserve funds.
You’ll usually be required to have at least 20% or more of the purchase price as a down payment as most Boards will not permit greater than 80% financing, but it varies. More conservative Boards may only permit 75%, 50%, or no financing at all. Shareholders pay a monthly “Maintenance fee” that covers building expenses and includes a pro-rata share of the building’s real estate taxes. Shareholders may also receive a pass-through tax deduction for the portion of the coop maintenance fee that is allocated to state and local taxes and any underlying mortgage interest.
Approval to purchase or sell is granted by a coop’s Board of Directors, and the very detailed required disclosures of a buyer’s financial position may be regarded by some buyers as quite intrusive. Buyers who may be uncomfortable with full disclosure applications may want to consider purchasing a condo. All prospective buyers must submit a Purchase Application (Board package) that includes detailed financial and personal information, including references, tax returns, and bank statements. Boards require in-person interviews with all prospective residents, sometimes even your dog. They make and enforce policies on pets, renovations, use as a pied-a-terre, and future sales. They will most often have restrictive subletting policies limiting them commonly to just 2 out of every five years, or even not at all. Foreign buyers without substantial assets in the USA are unlikely to be approved, even on all cash purchases. Boards have a fiduciary responsibility to protect the health of the Coop corporation, not necessarily to approve a purchase. There are virtually no coops being developed today, but they still dominate the resale market of existing homes. Read less ▴
Condops
The Tiffany Building, Manhattan, Live-Work Condop Loft
“Condop” is a commonly used slang term in the industry for any residential building whose legal form of ownership is as a coop, but with more relaxed house rules like a condo regarding resale and leasing. As with a coop, the buyer gets stock and lease at closing, not a real property deed. Condops are much less common than co-ops or condos.; and while this hybrid form of ownership might sound like a great combination, there may be some lifestyle considerations.
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Strictly speaking, Condops are mixed-use buildings with both a single multi-family residential condo, and retail or office space condos. That multi-family component is operated like a coop, where the individual units are leased to shareholders cooperatively.
They usually allow unlimited subletting from day one of ownership, or after a specified period of personal use. The application process is often simplified, and there may be no Board interview required. The idea of being able to rent out the unit without limitation as an income producing property is appealing, and often the main driver of interest in condops, but that comes with some real caveats too. It all depends on the particular building. Higher levels of investor ownership can make a building feel more transient like a rental building. In our opinion, the risk may be a little higher since these types of properties tend to be quite popular with budget minded investors. If owner-occupancy thresholds in the building are lower than a bank’s mortgage underwriters are comfortable with, it’s a condition that can limit, or even eliminate options for buyers to obtain financing, putting downward pressure on selling prices as a result. Real estate values are directly linked to the ability to apply leverage to the transaction.
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Your dreams have an address™
What are you searching for?We want to buy in a new buildingI need a townhouse expertI want to buy my first apartmentWe’re downsizing into a condoHow do I buy and sell at the same time?What’s my home worth?What’s your dream home?Ask PeterYour dreams have an addressSo where’s next?
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Peter Comitini is committed to supporting all fair housing laws
New York City Townhouses
Townhouses are a lifestyle choice as much as a rare and very special kind of private home. It’s often a community where the neighbors know each other and chat on their stoops
Private luxury
There are so many reasons why townhouses comprise some of the most sought-after luxury properties in our market. They often come with beautiful plaster details, ornate woodwork, and graceful proportions. They comprise just about 10% of the housing stock in NYC. Both Manhattan and Brooklyn have wonderful examples of these historic buildings, which are most desirable when they are a part of an intact row of similar, low-rise, vintage homes. Townhouses are a lifestyle choice as much as a rare and very special kind of private home. It’s often a community where the neighbors know each other and chat on their stoops in nice weather.
Landmarked 171 Maple Street, Prospect Lefferts Historic District, Brooklyn
Townhouses come with special considerations which are unique to the category, such as purchasing in Landmarked Historic Districts. These often preserve a residential neighborhood’s historic character and aesthetics, in balance with restrictions on an owner’s property use, expansion, and modification to preserve them. They exist in all five boroughs, but not every townhouse is located in one. It’s important to know if the home you’re considering is. There’s a lot to understand about buying a townhouse, including the zoning, financing, and ongoing maintenance of one.
We are specialists in helping our clients evaluate their choices and make the best deals possible on these special homes in Manhattan and Brooklyn. We often represent one and two family homes, plus smaller investment assets like apartments over stores. Small building owners will find outsized service with us working on their business; when ready to sell or execute a 1031 Exchange. We serve our clients with landlord representation to help them reduce vacancy and increase cash flow.
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These are nearly always multi-million dollar transactions in either borough. Brownstone Brooklyn is a particularly attractive, more affordable, alternative to Manhattan for many. We’ve noticed a pattern of our clients selling homes in Manhattan and buying there. Brooklyn has emerged from it’s “Honeymooner’s” phase in ways that bus driver Ralph Kramden would have not recognized. Today it represents a hip, urban cool that once drove the scene in downtown Manhattan. It’s a destination for foodies, fans of culture at BAM, sports and music at the Barclay Center. Not to mention what some say is Calvert Vaux & Frederick Law Olmsted’s best work at Prospect Park and smaller, but beautiful Fort Greene.
While there are modern Townhomes, most in NYC date back to the 19th and early 20th centuries. Even in well preserved homes it would not be unusual for these 100+ year old properties to need updates, restoration, and some degree of TLC. Some of these will be cosmetic, others will be deeper. There might even be room for some enlargement that can take advantage of buildable Floor Area (FAR), if permitted.
If you are seeking greater privacy, outdoor space, a garden, a backyard, and room to grow, a townhouse might just be the right fit. If you already own one, and might be looking to downsize into an apartment, we’d like to help to make that transition smooth and rewarding.
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How does the width of a townhouse affect its value?
Wider building lots accommodate larger buildings. One of the primary physical distinctions affecting the price of a townhouse will be its width. The most common lots are 18 to 20 feet wide, and houses that are 25 feet or wider are quite scarce, and commensurately more expensive. That’s in part because their width offers more layout options like side-by-side bedrooms, and very graciously proportioned parlors with high ceilings. Buyers looking for a more affordable house might wish to focus on buildings with a narrower footprint; which will often still have many desirable features such as a garden, yard, garage, and storage.
Read more ▾ You should note that square footage in townhouses and apartments are measured differently. While apartments are measured between the interior walls, in a townhouse you will be buying an entire building and land, not just the space in between the walls. Townhouses are measured to the building’s exterior walls, and will have a “loss factor” of 10% to 15%, in effective usable space. That is attributed to the thickness of the walls and mechanical rooms. So a 3000 square-foot townhouse is not necessarily the same interior space as a 3000 square-foot condo because of the way they’re measured. Townhouses come with mechanical rooms, basements, and cellars which should not be included in the quoted “habitable” square footage of a building. These spaces are both necessary and useful. They can be a substantial bonus. In recent years it’s been popular to dig out part of the backyard, adding windows and glass doors. Bringing light and air into a cellar recreation room with terraced landscaping stepping-up into the backyard. These homes may even have lower taxes than condos of the same size, with greater privacy and control. The idea of having a backyard deck and extra room to work at home are high on every townhouse buyer’s wish list, especially since the pandemic. The option of owning a two or three unit home, might also be a very good choice for people with extended families living with them; or to produce income that will lower the overall cost of ownership for those willing to be a landlord too. These are not cookie-cutter properties. You need an agent with a team of experts including: building inspectors, title insurance, attorneys, architects, designers, contractors, and handymen who will inform your decision. Conditions vary greatly and Peter will help you to evaluate risk and reward. His experience gives you a real advantage in finding, negotiating, and closing on the home of your dreams. Read less ▴
Buying Step by step
How does Peter add value?
Buying a home in New York City can be an intense, complex, but manageable process with Peter’s help. For most people it is a 3 to 6 month timeframe to close, and can be longer. We help clients understand what to expect. It’s a complex transaction that you’ll engage in once every few years at best. Peter’s team brings insights gained from doing it every day for two decades. We are here to answer your questions. There isn’t much that we haven’t seen before. Here is an idea of what it looks like step-by-step.
