Building types in Brooklyn
Mitchell-Lama co-ops in Brooklyn
Brooklyn’s Mitchell-Lama co-ops cluster along the southern shore near Coney Island and Brighton Beach, and several of them have already left the program.
What is different about buying a Mitchell-Lama co-op in Brooklyn?
Quick Answer
Brooklyn’s Mitchell-Lama developments cluster along the southern shore near Coney Island and Brighton Beach, and several have already voted to leave the program. So the first question in Brooklyn is not how the waiting list works, it is whether this development is still in the program at all.
Which co-op buildings of this kind are actually in Brooklyn?
- Large post-war developments near Coney Island, Brighton Beach and Sheepshead Bay built under the limited-profit housing program
- Developments elsewhere in the borough, including Williamsburg and Fort Greene, built in the same era
- Several corporations that have privatized and now sell at market prices with a flip tax adopted on the way out
- Developments still in the program, selling from waiting lists at formula prices under agency supervision
What do board approval and financing look like in Brooklyn?
- Establish program status before anything else: a development still in the program sells from a list at a formula price, a privatized one sells like any co-op
- A privatized corporation usually adopted a flip tax at conversion, and it is frequently a large one
- Where the development remains in the program, income limits apply at purchase and surcharges apply to shareholders above the limit afterwards
- Lenders treat a privatized development as an ordinary co-op and a program development as a regulated one, and the loan products differ
Which taxes and recording steps apply in Brooklyn?
- No mortgage recording tax and no recorded purchase instrument, the same as any co-op
- New York State transfer tax and the New York City real property transfer tax apply to the transfer
- A development still in the program is taxed on its shelter rent or carrying charges rather than on assessed value, and a privatized development gives that treatment up on a schedule
- Judgment and lien searches run against Kings County records, and the corporation itself is searched in the co-op lien search
What pattern does a purchaser meet in Brooklyn?
- The southern-shore developments sit in flood-exposed areas, so the corporation’s flood insurance and post-storm assessment history belong in the review
- A privatized development often phases out of its tax benefit over years, and maintenance rises as that happens whether or not the board changes anything
- Where a development is mid-debate on privatization, minutes and shareholder mailings are the only record of where the vote stands
- Buildings that left the program sometimes still carry program-era physical deferrals, and the assessments follow
How do you tell whether a Brooklyn Mitchell-Lama has privatized?
From the corporation, in writing. A development still in the program is listed by the supervising agency and sells from a waiting list at a formula price. A privatized one sells at market with a flip tax. The managing agent can confirm status, and the answer changes every other term of the deal.
What happens to taxes after a Mitchell-Lama privatizes?
The tax treatment the development held under the program, computed on its shelter rent or carrying charges rather than on assessed value, may be replaced by a phased reduction where one was adopted or negotiated; otherwise full taxes apply on dissolution. Carrying charges rise as the benefit steps down, and that increase is separate from anything the board does about operations or reserves. Ask whether a schedule exists.
What else should you read before closing on one of these?
In the glossary
- Flip taxA transfer fee charged by a co-op or, less often, a condominium when a unit changes hands. It is a creature of the building's governing documents, ...
- Maintenance (co-op)The monthly charge a co-op levies on each shareholder, covering building operations plus that shareholder's share of real estate taxes and the unde...
- Assessment (co-op or condo)A charge levied by a co-op or condominium board beyond ordinary maintenance or common charges, typically to pay for a capital project. It is disclo...
- Co-op lien searchThe search performed on a co-op purchase covering UCC filings, judgments, liens and unpaid building charges tied to the shares and to the selling s...
- Proprietary leaseThe occupancy lease a co-op corporation grants a shareholder for a specific unit. It is assigned at closing together with the stock certificate for...
Questions this raises
- Who pays the flip tax in a New York co-op sale?A flip tax usually comes off the seller’s proceeds, but plenty of New York buildings shift it to the purchaser. Why the rider has to name the payin...
- Who pays a co-op or condo assessment at closing?A NYC co-op or condo assessment is allocated by the contract of sale, not by custom. How installments and lump sums get split between seller and pu...
- What does a seller do to prepare a co-op for sale?Before listing a NYC co-op: locate the stock certificate and lease, confirm the payoff and lender custody, clear arrears and settle the flip tax in...
Building types
- Mitchell-Lama co-opA limited-equity cooperative in the State and City Mitchell-Lama program, sold from a waiting list at a formula price rather than on the open market.
- Standard co-opThe ordinary New York City cooperative: you buy shares in a corporation and receive a proprietary lease to occupy a specific apartment.
- HDFC co-opAn affordable cooperative formed under Article XI of the Private Housing Finance Law, with an income cap on purchasers and a flip tax that runs to ...
- Sponsor co-op unitAn unsold share allocation still held by the building’s original sponsor, sold under the offering plan rather than through the ordinary board process.
This building type, borough by borough
- Mitchell-Lama co-ops in ManhattanManhattan’s Mitchell-Lama co-ops run from Chelsea to the Lower East Side to Harlem and Roosevelt Island, and several have voted on leaving the prog...
- Mitchell-Lama co-ops in QueensQueens carries several of the largest Mitchell-Lama cooperatives in the city, including developments in Jamaica, Woodside and Astoria that between ...
- Mitchell-Lama co-ops in the BronxThe Bronx holds the largest cooperative development in the country, along with other limited-profit developments, and it remains in the Mitchell-La...
- Standard co-ops in BrooklynBrooklyn co-ops split into two very different populations: small self-managed brownstone corporations, and the very large post-war complexes along ...
- HDFC co-ops in BrooklynBrooklyn’s HDFC buildings sit in Bedford-Stuyvesant, Crown Heights, Clinton Hill and Bushwick, and many of them are small enough that the board is ...
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