You want a flip tax in your co-op!
It amazes me that when I bring a buyer to a co-op in NYC and they ask the seller’s agent, “Is there a flip tax?”
Usually, if applicable, the seller’s agent proudly says that the building does not have a flip tax, which is a great thing…………………..WRONG!!!!!!!!!!!
*note- most buildings do have a flip, just not all of the co-op in NYC.
I know as a co-op owner that the dreaded day will come when we go to sell and we will have to write a giant check to our beloved co-op for the privilege of living there. But you know what? It is really a good thing. The flip taxes go directly into the reserve fund and can be used when and if there is a problem with the elevator, roof, boiler or other capital improvements.
If there is not a flip tax imposed in the building and the reserve fund does not grow magically, as some would hope. Then when there is a capital improvement, guess what? You will be assessed in addition to your maintenance or your maintenance will increase due to theses projects. The current average maintenance cost is now around $1.60-1.65 per square foot in NYC. If you are creeping up over the $2.10 or north of $2.10 per square foot and don’t have a flip tax, don’t say I never told you. GET IT FIXED NOW!
Flip Taxes are a good thing and if your co-op does not have one, get on the board of directors and make it happen.
I have seen so many building where the maintenance is well over the city average and it directly negatively affects the sale price of the units.