My co-op seeking buyers and I ventured out again last Sunday to find a plan “B” and possibly “C” in case the seller of their initial choice doesn’t accept our terms. Surprisingly, she did come back with a counter that my sellers agreed to, but won’t budge when it comes to letting them have a mortgage contingency and so we are at a stand still.
We did in fact find plan “B” and “C” in the same co-op. Now one half of my buyers prefers plan “B”, while the other half still loves the first one (plan “C” is if all else fails). Tonight they will hopefully come to an agreement. In the meantime, I’ve become obnoxiously elusive to the sellers agent who’s impatiently waiting for me to tell him that my buyers will move forward without the contingency. If he weren’t such an arrogant cuss I might feel bad for leaving him hanging but instead I feel quite satisfied. I can only hope that all of the apartments will still be available by the time my buyers make their decision.
What I’ve noticed in this volatile market, where condo-buyers are losing out on their first, second and third choices to all cash buyers and foreign investors, co-op buyers stand a better chance of getting their first choice and having a heck of a lot more options to choose from.
There are several reasons for this. The first being that NYC is 90% co-op so there is that much more inventory. Secondly co-ops typically allow you to finance anywhere between 0%-75% (condos typically allow 90%). That’s a big chunk to put down for most non-cash buyers. Then they need to show that they have about 2 years in reserves between mortgage and maintenance after closing, also a big nut to have squirreled away. Additionally, co-ops are not as attractive to foreign investors due to their strict subletting policies.
As long as a buyer is financially sound, prepared to furnish a mountain of paperwork for board packages, and most of all, willing to be scrutinized by the buildings board of directors, co-ops might just be the way to go. It’s a “slow and steady wins the race” type of mentality I suppose.
Stay tuned…