Monthly condo fees and co-op maintenance are important criteria when judging the value of a potential new home.
Everyone wants them to be low enough to conform to their budget. However, the pitfall can be when they are too low.
Those monthly charges to shareholders and owners are what keep a building running right.
Depending on the building, they cover such costs as heat and hot water, the maintenance of common elements such as the lobby and any outdoor spaces, snow removal, exterior upkeep and repairs. Sometimes cable-tv and electricity are included.
Amenities such as gyms, saunas, swimming pools and basketball courts substantially add to those costs.
Labor is a huge component of a building’s expense. Consequently, so-called white-glove buildings have much higher fees than more modest ones, but pre-war buildings with their aging infrastructures don’t necessarily levy more charges than do new developments with their extravagant amenities.
Another critical part of the budget and each resident’s share of it has to be the reserve fund. Feed it too little, and special assessments are bound to follow.
Is there enough cash in the fund to cover a boiler conversion to environmentally acceptable oil, to replace a leaky roof, to undertake an overhaul of the electrical or plumbing systems, to defend the building against a lawsuit, to account for a leap in property taxes or of the price of oil?
Not only do sufficiently high fees protect against a financial jolt in the form of a special assessment for months to come, but they also protect the value of the building and thus of its apartments.
Although the saying goes that death and taxes are sure things, know that monthly fees rise year after year as predictably and certainly as spring follows winter.
Tomorrow: Don’t blame Canada
To take your own bite out of the Big Apple, you have the option here to search all available properties privately.
Malcolm Carter
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201
Malcolm@ServiceYouCanTrust.com
Web site
I, on Cambodia 
Much of BPC is land lease–it’s not, as Naomi seems to suspect, the cost of building the landfill (an expense that would disappear over time if the buildings owned the land and financed the landfill). Rather, the Battery Park City Authority, a State agency, retains title to the land. After 30, 40, 50,…100 years, the buildings still wont own the land, and they will likely pay increasing land rent to account for increasing land value (somewhat lessened by the politics of increasing costs, as in the recent $280 million tax for BPC).
LikeLike
For several years I’ve been mystified by the high condo carrying charges throughout Battery Park City, a terrific neighborhood. Apartment prices are quite low but the carrying charges blow the neighborhood out of my ballpark.
Could you investigate the reason? At some point I was informed that the charges reflect a long land lease the City held on the Authority to repay the great cost of the landfill on which BPC is built. Is that so? And if the land lease ran out, as I heard it would in 40 years, why are costs still so high?
LikeLike
Naomi, I am unaware of the causes of the high costs there. Perhaps another reader can provide an explanation. It happens that I have buyer about to be searching in the area and so also would love to have the information. At some point, I probably will see the financials and will be in touch if so.
LikeLike