Although advancements have been made in Westchester, Suffolk, and Nassau Counties, state regulations surrounding co-op board approvals and rejections have remained stagnant in recent years despite a push for increased transparency. In 2021, a bill that would require co-op boards to provide written explanations for rejections was shot down in the New York Senate. In early 2023, Public Advocate Jumaane Williams and 14th District City Council member Pierina Sanchez proposed a bill that would create a standardized application and require a reason for rejection within five days of the board’s decision — this bill has been neglected since. In light of these attempts to streamline the co-op application process, the Law Office of Marc Scolnick, P.C. wants to outline the consequences of a possible regulation change in the near future.
First, we mustn’t neglect to mention that co-op purchases are effectuated through the purchase of shares of stock in a corporation. This means that co-op ‘owners’ don’t necessarily own their unit, rather they have a right of possession through a proprietary lease.
Most debates on the co-op board review process focus on prospective buyers, however a regulation change would substantially affect sellers too. Current standards force sellers to consider, aside from the buyer’s financials, the immeasurable probability of board approval. The ideas of Williams and Sanchez would, in theory, give sellers a track record on which to base their judgments over time — as their respective co-op boards accrue rejection histories.
Since we represent both buyers and sellers of co-op shares, we continue to monitor the newest developments in co-op board regulations to offer our clients the most comprehensive breakdown when it comes to this complex domain of real estate.
Questions on how this could affect you? Call us today at (718)-554-6445 to set up a FREE consultation!
Sources: https://therealdeal.com/new-york/2023/02/02/bill-targets-co-op-discrimination-against-buyers/
https://www.nytimes.com/2021/09/04/realestate/co-op-board-discrimination.html
