| HDFC Coops - The Best Deal in New York City Real | | | | building so to get $150,000-as much as $500,000 for |
| Estate | | | | one of these apartments which they paid only $250 |
| Have you been frustrated with the high prices for | | | | for is a huge windfall. |
| apartments in New York City? Well here's the good | | | | The buyer is getting a chance to own a piece of |
| news: If you have ever wanted to live in New York | | | | New York City, one of the most expensive real |
| City at an affordable price, well, look no further. If | | | | estate markets in the world, for a fraction of the |
| you qualify, you may have just found the greatest | | | | price of regular Coops or Condos. Very often, HDFC |
| deal in New York City. | | | | coops sell for $400-$600 per square foot where as |
| HDFC Coops, a little know niche market in New York | | | | coops and condos in New York can sell for |
| Real Estate, represent the "last great deals" in New | | | | $900-$3000 per square foot. This is clearly a huge |
| York City. Frequently these cooperative apartments | | | | difference. |
| sell for 40%-60% below there comparable regular | | | | Don't think these HDFC's are in bad neighborhood's |
| Coop or Condos for sale. HDFC's (which stands for | | | | either because many of these are in prime New York |
| Housing Development & Finance Corporation) | | | | City neighborhood's such as the Upper East Side, |
| have been around for many years but it is not until | | | | Upper West Side, Lower East Side, and Williamsburg, |
| the last few years that more and more people are | | | | Brooklyn. |
| discovering these amazing deals. They are only | | | | Downside |
| available in New York City although there may be | | | | Does it sound too good to be true? Well it isn't too |
| other programs in other cities that are similar. | | | | good to be true, but you must qualify to buy. In |
| The History of HDFC's | | | | many cases, to qualify to buy and HDFC coop, you |
| HDFC coops are city sponsored coop apartments | | | | need to make less than 120% of the areas Median |
| that offer many of the benefits of a regular coop | | | | Income. In 2008, this number was $64,500 for 1 |
| apartment but they also have some restrictions on | | | | buyer and $73,725 for 2 buyers in a family and |
| purchase and they frequently have a "flip tax" upon | | | | $82,950 for 3 buyers in a family. Alternatively, some |
| sale. | | | | buildings, depending on the by-laws of the coop, have |
| An HDFC coop came to be for one of a couple | | | | income restrictions to buy based on a multiple of the |
| possible reasons. They may have been originally a | | | | yearly maintenance and utility charges that the |
| rental building which had been abandoned by an | | | | apartment has. In either case, usually the |
| owner or the owner may have owed back taxes or | | | | management company and/or the Board of Directors |
| water and therefore lost the building to the city. | | | | of the coop will look at the adjusted gross income of |
| The City then rehabilitated the building, trained the | | | | your previous 2 years tax returns. |
| tenants on ownership, set the Coop up financially to | | | | In addition to an income restriction to buy, many |
| be self-sustaining, and then sold the apartments to | | | | HDFC Coop's have a "flip tax" when you sell. |
| the existing tenants for $250 each. Yes, that's right, | | | | Typically, this flip tax is calculated as a percentage of |
| $250! | | | | the profit that you make. The profit is defined as the |
| The premise is that rather then the City being a | | | | sale price minus the purchase price. The flip tax could |
| landlord, you have now trained a group of owners | | | | be as low as 5% and can range up to as much as |
| who care about their building and their future. It has | | | | 85% of your profit. |
| been a very successful system. | | | | Clearly you need to take these factors into account |
| Typically over the years these HDFC coops changed | | | | and depending on the flip tax the Coop has, the price |
| hands among friends or relatives for very cheap | | | | and value of the apartment may vary greatly. |
| prices. In the past several years, some brokers with | | | | Summary |
| foresight have realized the value these Coops | | | | We have seen that an HDFC coop represents a |
| represent, and upon being marketed more | | | | great opportunity to own a piece of the "greatest |
| professionally, much higher prices have been realized | | | | city in the world" at a fraction of the price of other |
| for the Owners. | | | | coops and condos but with that comes some |
| Benefits | | | | restrictions on purchasing and upon selling you often |
| This has benefited both the buyer and seller of an | | | | have to give a portion of your profit back to the |
| HDFC apartment. A seller now has realized much | | | | coop and/or the city. |
| more money than they ever thought possible and | | | | Tips when buying or selling an HDFC Coop |
| they have a chance to realize their dreams. Many | | | | Find a broker who understands the rules and |
| sellers of HDFC coops have gone on to move to the | | | | restrictions of HDFC Coops. There are many |
| suburbs and buy a house or take a dream vacation, | | | | intricacies to the process and if a buyer or seller is |
| buy a nicer car, and live a nicer lifestyle. Remember, | | | | not qualified properly, you may find yourself wasting |
| the original owners of HDFC coops were there | | | | a lot of time just to find out you can't buy or sell the |
| because they typically lived in a run-down neglected | | | | apartment. |