Home Buying in New York>Question Details

Amelia, Home Buyer in New York, NY

I bought a condo apt. in a new building. No other units have sold. What happens if the other units don't sell?

Asked by Amelia, New York, NY Fri Nov 21, 2008

At some point is the building no longer a condo? Could the owner of the building be forced to buy me out? It's only an 8 unit building and none of the other people in contract (only 2 other people) have been able to close, I'm assuming due to the market tanking. So far the owner has been very unresponsive to fixing things and I'm basically looking for any type of out I can find.

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6
As others have said, this is a legal question, best left to a lawyer. Start with the one who handled your closing.
1 vote Thank Flag Link Tue Nov 25, 2008
Sorry, I wasn't clear. I'm in the unit. Have been for a few months. Some of the other tenants who are in contract are renting for now. They are loud at all hours and the owner of the building has been unreceptive about it. I've also had some issues with some of the construction that was done and he's either been unreceptive about fixing it or it's taken him a long time to do it. Per the offering plan things should be fixed immediately. However, it got to the point that I mentioned taking him to court over things and his response was that I'd see an increase in my maintenance fees due to court costs. This is why I'm trying to figure out if I have any out due to the other units not selling. I truly doubt the people renting who are in contract will actually be able to get a mortgage now. So that means one unit sold - mine.
0 votes Thank Flag Link Tue Nov 25, 2008
Usually if the building has sold more than 15% of the units then your unit would proceed to closing. But if they have not sold the required 15% they would let you get out of the contract. If it's a situation where you have already closed on the apartment the developer would probably rent out the rest of the units if they are not able to sell them. In any case you need to refer to your attorney.
0 votes Thank Flag Link Tue Nov 25, 2008
DISCLAIMER: First and foremost, seek competent legal advice, not advice from an Internet message board.

I think the key to answering your question is inside of the Condo Documents that you were given prior to or at closing.

The documents are very specific about the Home Owners Association and the fiduciary duties of the developer.

Usually the developer retains control of the HOA until the property is 50% to 80% sold out depending upon the structure of the HOA entity.

There are financial sureties and bonds which must be in place in order for the developer to be given condo status for the property.

I have found that people become VERY RESPONSIVE when you start to make a claim against their bond, because bonds are personally guaranteed by the principals personal assets.

The only way the building is no longer a condo, is when the declaration or condo docs are voted out by the members in good standing of the HOA, if that can be done.

Its going to be sticky no matter what and I hope that you purchased because you liked the building, location, what it has to offer and is affordable for you. If you are going to be in for the long-haul of 5 to 10 years then this is really not going to be much more than another speed bump on the road of life.
Web Reference: http://www.paxauctions.com
0 votes Thank Flag Link Sat Nov 22, 2008
Dear Amelia,

The best thing that could happen is that the bank forecloses and they manage the property while they try to find a new builder to finish things.

The current owners will never do anything and i would suppose they don't have the money.

Having said that, i would go to the local municipality and file a complaint with division that handles enforcement of housing violations.

Sometimes, they can fix the problems and lien the property.

Best of luck!
0 votes Thank Flag Link Sat Nov 22, 2008
Speak to an attorney, as you had a contract to buy and have the contract has been carried out. You should be able to take him to court to do the repairs, but getting out of a contract, and one that has already enforced might be tough. Speak to a lawyer.
Web Reference: http://Paulmvpteam.com
0 votes Thank Flag Link Sat Nov 22, 2008
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