All Forum Posts by: Jason Lee

I don't recall seeing a new dev with anticipated 421a not get the 421a. Does your attorney specialize in real estate transactions? Ask him if he's ever seen a condo not get the 421a. He should be able to give you an answer rather than cutting and pasting from the offering plan.

The closing shouldn't be open ended. There should be a deadline for the first closing in the special risks section. If they can't close by then you should be able to cancel your contract.

These are some of the inherent risks with being the first to go to contract at a new dev. Hope you received concessions for taking on that risk. Sponsors have been pretty negotiable these days when trying to get to 15%. How long have they been selling? I'd probably be more concerned with the pace of sales and why no one else is interested. There's just a lot more risk in a condo with so few units.

In NY an RE agent can represent the landlord, the tenant, or both through dual agency. It works similarly to the way a buyer's agent works. Agent shows tenant properties, helps negotiate the lease, and will either collect commission from the buyer or from the landlord. If landlord pays the commission then the agent would split it with the landlord's agent if there is one (there might not be if it's an open listing). 

Yes you can use depreciation for a co-op rental. The method to calculate is quite different than with real property. Look up IRS pub527 on how to calculate.

You probably wouldn't need a property manager in Manhattan unless you have many units. A real estate broker will find and vet tenants for you and they will often collect their own fee from the tenant. If you have condo units then the HOA will handle garbage, etc. If you have a townhouse you can find a super on the block that will do garbage, clean and shovel, or have a tenant take care of it. What scope of work do you need done?

400k in HOA arrears is a lot! The condo should have filed liens and you can usually see those on the county website if you want more info. If any of those owners get foreclosed the condo might never recoup most of the arrears regardless of lawsuits. Then on top of that you'd be buying in just as they start on a bunch of major capital improvement projects. It might not be a "financial hole" but you can expect the HOA fee to go up quite a bit and perhaps an ongoing special assessment. What was the 2mm for in 2015 and how are they going to pay for the upcoming work? This doesn't sound like a great place to buy as a primary residence or investment. You're already in contract with no financing contingencies so it might be spilt milk but you should speak to your attorney about any ways to get out. Curious why you want to live there for a year and then rent it?

Easiest way to go about this would be to hang your license with a broker so you don't need to form an LLC/company (start your own brokerage). If you start your own brokerage you will pay more to join the local board, your own e & o insurance, set up MLS access, etc. There's no point in doing all that if all you want is MLS access and to occasionally work your own deals. This is all separate from forming an LLC for your flipping business. You'd check off the "Associate Broker" box on the broker application. Just find a brokerage that's ok with you just hanging your license with them with the understanding that you're going to do it part time. There are plenty out there.

There are no 100k condos in Fort Lee. You're seeing co-ops and those co-ops don't allow investors.

I had a heloc on a co-op but it was a primary residence at the time. It was with Bank of New York before they merged with Mellon so not sure if they still do them. I'd also try NCB, and this is where a good mortgage broker might come in handy. PM me if you'd like referrals. Keep in mind, most co-ops have to approve helocs so if this started out as a primary residence the board might want to look at your current debt-to-income which might or might not open up a can of worms.

It doesn't matter if it covers the whole state. You need an MLS that is used by the majority of agents that do deals in the areas you plan to focus. Who's migrating over? There will never be a default MLS covering the entire state. It's too large. My brokerage and I get NY State MLS access for free and I never use it. Why do you think they give it away for fee? Find out how many members each MLS has. I'd guess NY State has the fewest.

Hudson Gateway will cover most of what you need. If you are hoping to do a lot of deals in Brooklyn then you'll also want to join BrooklynMLS. It's not an NAR MLS and it's relatively inexpensive. If you want to do deals in the prime areas of Brooklyn then you'll want to join REBNY which is also not NAR (it covers Manhattan and prime Brooklyn and western Queens). I don't think you need NY State. Keep in mind you also have to find a broker that is a member of all the MLSs you want to join so more likely a larger brokerage that has offices in all the different locations.