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Coop with multiple years of assessments

Started by qs123
about 10 years ago
Posts: 0
Member since: Feb 2016
Discussion about
A coop has four years of assessment, about 17% of maintenance each month. Is this normal? In addition, this building rented out their laundry room to outside laundry companies, is this a good sign?
Response by callahan
about 10 years ago
Posts: 37
Member since: Nov 2014

Depends what work they did and how much the full cost is .
Possible that a one-time assessment would've crushed the shareholders , so it was spread out over a number of years instead to ease the burden

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Response by REMom
about 10 years ago
Posts: 307
Member since: Apr 2009

You have to look at the assessment history alongside the maintenance to see if it's reasonable relative to maintenance in similar buildings. Some buildings have a higher maintenance and funnel money into reserves for capital projects or borrow. Others don't maintain large reserves and use assessments for capex.

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Response by Aaron2
about 10 years ago
Posts: 1706
Member since: Mar 2012

It is not unusual for a co-op to contract with a laundry company to provide and maintain machines. They usually don't 'rent out the room', but rather permit the company to install their machines and collect the income. The co-op may or may not get a cut of that, depending on the estimated cash flows.

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Response by kylewest
about 10 years ago
Posts: 4455
Member since: Aug 2007

If finances are otherwise sound, assessments (versus maintenance increases) are preferable insofar as they get added to your cost basis when you sell the apartment and can reduce capital gains if you have any that are taxable. You can't do that with maintenance increases to cover capital improvements.

But really you are just providing one data point and that isn't enough information for any conclusions to be drawn from that one point in and of itself.

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Response by fieldschester
about 10 years ago
Posts: 3525
Member since: Jul 2013

Take tax advice, non-specific at that, from a non tax professional at your own peril.

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