It’s no secret that I’m a supporter of transparency in real estate…every aspect of it. Which is precisely why I believe that something needs to be done about the secret society that is the Manhattan co-operative. Check out these previous TG posts:
A bill that would affect co-op boards, long stalled in the City Council, is getting a boost from local law professors who yesterday sent a letter to Mayor Bloomberg and Speaker Christine Quinn urging action on the legislation.
The bill would require co-op boards to disclose specific reasons for rejecting potential apartment buyers. It is supported by a majority of the council, a host of civil rights groups, and now 13 law professors from universities in the city.
It’s going to be very interesting to see how this plays out and whether or not Bloomberg would support such a bill. I suspect he has quite a few friends on Co-op Boards who strongly oppose such legislation.
Opponents of Mr. Monserrate’s bill say disclosure of reasons for rejection is hardly a solution to the onerous process of buying in a co-op, and boards would never openly disclose if they did engage in illegal discrimination.
One of my readers suggested the following quite some time ago and I found it quite intriguing:
My thoughts are having a set of ‘standards’ for coop boards and establishing a group (either self-governing or through the city) to ‘audit’ boards and ensure they are meeting these standards. Much in the same way that public companies now have to have their auditors sign off on internal controls.
Such standards could include maintaining sufficient meeting minutes, whether all shareholders are required to have homeowner’s insurance (some boards actually don’t require this!), etc.
The ‘auditors’ wouldn’t necessarly opine about the coop’s management abilities but instead disclose whether coops are meeting these standards.
Kind of like a public health inspector…does’t matter what the food is like or how much they charge, but make sure the place is clean.
Of course there would be the cost of maintaining this process but it might be less than legal fees incurred as a result of the proposed law. And if done effectively you’d see the price gap btw condos & coops narrow.
An interesting proposition. What are your thoughts?