What is the rule of thumb on how much maintenance should be?

Asked by Julie Manis, New York, NY Wed Jan 30, 2013

For a full service building? Non-doorman building? What would be considered on the high side, or suspiciously low? Is there a way to find out the building's history of assessments (which seem to me like hidden maintenance?)

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First Last, , 90002
Fri Feb 1, 2013
The only way to assess if maintenance is competitive is to compare with similar apartments in the area, taking amenities into account of course.

Suspiciously low is tricky. We own a co op with a self liquidating mortgage, which is quite rare, and will soon make our maintenance unusually low and our financials unusually strong. So you have to know why maintenance is low before you assume it's a red flag.

Assessments are not hidden maintenance. There are different kinds of money, different pots if you will, that need to be filled at different times. There are capital improvements and operating expenses. Assessments are temporary and are assessed to address a specific need, usually capital improvement or a major repair. Maintenance payments are for the ongoing support of the corporation that owns and manages the building, including salaries. Assessments are not a bad thing, or a red flag, in normal circumstances. Rare indeed is the building that never, ever has any assessments. And yes these can be determined by reading the board minutes over the years or simply asking a resident who's been in the building for awhile.

Your best path is to make sure you choose a place with a maintenance level that is very comfortable for you, so you don't over extend. A reasonably stiff co op board will make sure you don't overextend, because they will require 2 years of maintenance/mortgage money in liquid assets (e.g. in your bank) at closing, among other financial criteria.

Karla Harby
Licensed Real Estate Salesperson
Rutenberg Realty
New York, NY
212 688 1000x146
1 vote
Mitchell Hall, Agent, New York, NY
Thu Jan 31, 2013
Hi Julie,

Maintenance can vary building to building. However, in my opinion the best way to determine if a particular building's maintenance is too high is to compare apples to apples. Other full service buildings on the same block or few block radius to others. Coops to coops, condos to condos other non doorman buildings to non doorman, prewar to prewar, walk up to walk up, amenities to amenities etc.

If a particular building has a much higher maintenance than comparable neighboring buildings (apples to apples only) in my opinion unless it is an extraordinary special building then comparable units in the building with the higher maintenance have less value and will sell for a lower sale price than the comparable units in buildings with lower maintenance.

The maintenance is always associated with the unit. You can't pay off maintenance like a mortgage. Based on current interest rates $100/month will get you about $20,000 in a mortgage. In my opinion every hundred dollars in excessive maintenance is worth about $20,000. How much will it cost you monthly to live there? The maintenance is an important part of the equation.

Best,

Mitchell Hall,
Lic RE Assoc Broker
The Corcoran Group
347-921-4255
mhall@corcoran
http://corcoran.com/MHALL
http://nycblogestate.com
1 vote
I think Mitchell is right when it varies from building to building. I also think it varies depending on your area. I would call around and see what the general price is to give you a better idea. Good luck! http://www.solveall.com.au/index.php?option=com_content&view=article&id=12&Itemid=111
Flag Wed Sep 17, 2014
Anna M Brocco, Agent, Williston Park, NY
Wed Jan 30, 2013
Maintenace does vary building by building, there really is no rule of thumb. Before entering into a contract to purchase, you can however review with your attorney the building's financials, including any assessments, and all other related paperwork....
1 vote
Oliver Orlic…, Agent, NY,
Wed Jan 30, 2013
Maintenance can range from $1 per square foot up to $4 per square foot. It is going to vary considerably from building to building and neighborhood to neighborhood.
0 votes
Christopher…, Agent, Tarrytown, NY
Wed Jan 30, 2013
Hi, It's typically based on the amount of shares you have, the buildings overall property taxes, and cost to maintain common areas. You can see the financials by contacting the management company for the building.

Chris
0 votes
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