Protection from future assessments when purchasing

anything is possible. the issue is that you will have to put money into escrow and draw from it. another issue is for how long should the money remain in escrow before being released to the seller.

a reasonable thing to do is to provide an offer that already estimates the assessment and subtracts it from the offering price.

If the amount and duration of the assessment is not stated in the minutes, it would be hard to determine a number to negotiate in the offering price.

Any coop or condo has a possibility of having an "unforeseen" special assessments in the future. As long as the buildings finances are in shape, they should keep the $ amount of an assessment low. Flip taxes in Coop's can help off-set this figure as well as contributing to the capital reserve.

What would be good to figure out is what portion of the assessment is tax-deductible.

if your seller will agree to be liable for future undetermined assessments, i'd bet their accomodation indicates you are seriously overpayinf for the property

i would have laughed at a buyer who proposed this, when selling apts i have in the past

any seller not desperate to preserve a deal with you (which means you are overpaying) would tell you to get a good lawyer, do your due dilly, and bid accordingly

"Has anyone had success including a provision in the sales contract that would force the seller to pick up some or all of a future assessment?"

I managed to get into my sales contract a provision that the seller would pay ALL of my maintenance in perpetuity.

Oh yeah, and foot massages every Wednesday.

Relative bought a coop and had this contingency put in. The amount was capped. Seems to be much about nothing since the price could've been adjusted just as easily...

NYCMatt: Uhhhhhhhhh, can I please have the contact info of your lawyer? Thanks.

Grizzly, why would money for an assessment be tax deductible? It would add to your cost basis, but it's not deductible unless it's being used to pay property tax or building mortgage interest (which I can't imagine it is).

I'm with the others - adjust your offer accordingly. Eve if the seller were crazy enough to accept, do you really want to go through the hassle of trying to collect on it, should it come to that? It's going to involve time, possibly legal expenses, etc. Take a lump sum you feel good about and be done with it.

When selling a previous place, a buyer wanted me to put money into escrow for mechanicals that were deemed near the end of their useful lifecycle. I balked, and after a lot of discussion, eventually settled on a very small credit.

On the other hand, when we bought this place, we got our seller to pay the remainder of a declared assessment even though the work for the assessment wouldn't begin until after our closing. The key for is that it had been declared. Had the board not settled on an amount (which turned out to be insufficient, but we knew that going in), we would have been SOL.

lad I did some digging and found out that:

Only if that assessment was your proportional share of an ad valorem property tax assessed on the entire property. If it was your share of a repair or capital expenditure for the property then you add it to your basis in the shares for your unit.

Generally, the IRS does not research what a special assessment was for. When you sell, you just add the special assessment to the cost basis. You do not, of course, invent some formula to take a tax deduction for an assessment before you sell.