The Manhattan real estate transaction is ANTI-GREEN! It is archaic! It is wasteful! It is insane how much paper is wasted in one single real estate transaction in a day when scanners and digital images are so readily available and prevalent.
In order to understand my complaint here I must first give a little bit of background to the Manhattan cooperative housing market. If your a non-Manhattan resident, continue reading. If you live here and are familiar with co-ops, go directly to the next paragraph. The primary Wikipedia definition of a cooperative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise. In New York City, when purchasing a co-op, one is buying shares in a corporation and the right to sign a proprietary lease to live in a property with rules completely determined and governed by a Board of Directors. The Board of Directors is generally made up of between 5 and 9 people who are appointed via election to conduct the corporation’s business including the review and approval, or not, of prospective shareholders (apartment buyers). Unlike a condominium, a shareholder does not own real property and thus must obtain approval from the Board of Directors if they wish to renovate, refinance, or rent the home to someone (sublet). Here is where the absolute waste of paper comes in.
Each member of the Board of Directors must review a prospective purchaser’s application. This application is comprised of detailed personal and financial information including several month’s of bank/brokerage statements for every one of the purchaser’s accounts, business, personal, employment, and housing reference letters, at least two years of income tax returns with all schedules and a variety of miscellaneous documents and forms that are required as part of the contract or by the Co-op Board themselves. Assuming an average of 6 people on the co-op board and a low estimate of 200 pages per copy, we’re talking about 1200 sheets, almost 3 reams of paper that are being disseminated to each and every Board for each and every co-op sale in New York City.
The impetus for this post is a very easy solution that has already been implemented by the Board of Directors at 20 West 77th Street. Make one copy of an application and all supporting documents, scan it, and disseminate it to Board members over a password protected web site. Not only would this save on paper but it would insure that the sensitive information that is contained in these documents doesn’t fall into the wrong hands and create identity theft issues.
So why aren’t more managing agents and/or Boards embracing this policy? No reason at all in my opinion except that they haven’t thought of it. It would save money and time for not only real estate agents, but managing agents and co-op Boards as well. And let”s not forget how many trees it would save too!
In an age where technology offers an efficiency never before seen in the real estate world, it amazes me that so many still choose to practice archaic methods.