Good news first: It's actually possible to purchase an apartment in Manhattan for under $300,000 or so. (Yes, an actual apartment—not a closet! And yes, purchase to own, not rent!) Every so often, a Housing Development Fund Corporation (HDFC) co-op unit hits the market, providing a rare, affordable option for prospective homebuyers.
But the discouraging news? Not only are they pretty rare, these real estate bargains are also a bit of a catch-22: To buy one, you have to have a yearly salary under a certain threshold, but you also have to have significant cash on-hand for down payments (and in some cases, for the entire purchase price). This significantly limits the pool of house hunters who can actually buy this type of co-op. In rare cases, people save up. A lot of times, though, it's people (think recent college grads) with a modest salary who come into an inheritance or get a financial boost from their families, or retirees with no monthly income but plenty of cash in reserves. Sigh.
New York City's HDFC co-ops emerged in the 1970s when, during an economic downturn, landlords began abandoning their buildings. The buildings were turned over to residents to manage. It started off as an experiment but since has evolved into a niche way for low-to-middle-income New Yorkers to purchase homes.
The units are typically well-below market value, which means your mortgage will cost less than renting a similar-sized unit, explains Eugene Gamble, a property investor and senior partner with Property Whisperers, a property investment and development company.
Intrigued? Here's what else real estate experts say you need to know about HDFC co-ops.
from Apartment Therapy | Saving the world, one room at a time https://ift.tt/2Il2hjF
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