Coop financing

What neighborhood is this in?

$85,000 for an average apartment is a lot. It's part of the reason why the seller is asking only about $250,000 for the apartment.

It's not as if your paying $250,000 with higher maintenance is the same as paying $335,000 in a mortgage-free co-op. The underlying mortgage is a short-term commmercial loan, with prepayment penalties, so you're vulnerable to interest-rate swings.

I'd get on ACRIS and find out where that $10,000,000 came from. It would've been a lot even for a building converting 20 or 30 years ago whose prices are now only $250,000. Maybe the co-op's been increasing the debt instead of raising maintenance when it should, or was a land-lease that bought its land, or something.

You may as well give us the address, as this doesn't sound like a place where people are lining up to buy and you'd be alerting the competition.

Technically, you need to divide the mortgage value by the total number of shares, then multiply that per-share cost by the number of shares in the unit you're considering (unless all the units have identical numbers of shares assigned to them).

But as NWT suggests, it's more important to know the size, nature, term, and interest deductibility of the mortgage, in the context of the overall building than the per-unit cost (unless they're planning on assessing everybody and paying it down or off).

ACRIS does not provide details about the loan but I have building financial statement and it's very difficult to understand. The building is known for a high meintenance but has a beautiful view which I like.

I wouldn't worry about it too much. There's a ~120-unit co-op up there with a $30,000,000 mortgage, which must have really crazy maintenance for the neighborhood. Just add your share to the nominal price, and be aware that you can't nail down that share with 30-year-fixed debt, so your maintenance might take a hit when the next re-fi rolls around.

It could also drop, but don't plan on it. My co-op re-fi'd this year at 4-something%, down from the 7% we were paying from 2003-2013, but the savings are going into reserves.