Applying for a co-op can lead to a lot of scrutiny for the buyer, and now a controversial bill on the floor of the City Council is calling for co-op boards to disclose the details of the decision-making process. NY1's Real Estate reporter Jill Urban filed the following report.
The process of applying for a co-op is time consuming and scrutinizing. Now that process itself is under the microscope, as a new controversial bill before the City Council calls for more transparency and uniformity.
Frederick Peters, the president of Warburg Realty, says, "[City] Councilman [Lew] Fidler has proposed a bill, Proposition 188, which would address both issues of possible discrimination in co-ops and also the time that co-ops have to make decisions about possible candidates."
Among other things, the bill calls for imposing time frames on boards and managing agents to respond to applicants at various stages the process. If they don't, the buyer is deemed approved.
The other key component would require board members to sign a certified statement that they did not unlawfully discriminate against a rejected buyer based on race, religion, nationality, etc. It does not, however, force boards to disclose the reason for the rejection.
Opinions on the bill are mixed. Real estate attorney Eva Talel, for example, is opposed to it and says fair housing rules are already on the books.
"This bill, in my view, would do nothing to address 'discrimination' of an unlawful nature," Talel says. "But what it would do is put a serious damper on boards' ability to lawfully make discriminating decisions about who is going to share the building with the rest of the building."
She also thinks it could result in more rejections just because the board will not have enough time. Also, she fears it would also deter people from volunteering to sit on boards.
Peters, who testified before the City Council, also questions the worthiness of the discrimination component, but he does strongly support imposing time restrictions.
"You can't close on a property until you get board approval and if that approval is not expressed for months at a time, you have a seller who can't sell because of a contractual obligation, you have a buyer who can’t buy something else. These people are in limbo and it's just unfair," Peters says.
Currently, the bill is on the floor of the City Council for discussion, and NY1's Real Estate Report will follow how this plays out.