Why Co-ops Work

Why do so many New Yorkers live in co-ops? I live in one myself. Are co-ops small minded, snobbish and a huge pain in the neck to get into? Well, no, not really … Sometimes they can be difficult and seemingly arbitrary in their rules and rulings. But there are enormous advantages to the co-op system. Here are a few of them:

* There is a real sense of shared purpose. Co-ops have always been, and have increasingly become, vertical villages. They are like a small home town. Most have basement amenities such as gyms and playrooms where residents meet, and many throw several annual parties where the residents can mingle. They create a small town feeling in the big city.

* Co-ops are self-governing democracies, observant of the wishes of the residents. And most Boards have term limits, which guarantees that new blood and new ideas make their way into the governance structure. Everyone cares about where they live. And Board service is fun and interesting. I spent many years on the Board of our building on Central Park West, several of them as President. I learned an enormous amount about the running of this little enterprise which has made me both a better neighbor and a better broker.

* Co-ops have a high level of financial solvency. They scrutinize the financial statements of prospective purchasers carefully and tend to discourage excessive  borrowing among their constituents. This led to minimal defaults in co-op buildings over the last couple of years where throughout the rest of the country mortgages were being foreclosed right and left.

* Since co-ops tend to have strict rental and residency requirements, your neighbors will actually live in the building with you. You will never have that feeling which can afflict condominium owners in which you feel like you are the only owner who really lives in the building. You know you are surrounded by people who care about the good health and reputation of the building as much as you do.

* New York’s historic apartment stock is mostly co-ops. If you long to live in an old building with high ceilings, large square rooms, and plaster walls – or if you only want an address on Park, Fifth, or Central Park West, chances are you will end up in a co-op.

* While Co-op Board Admissions Committees do sometimes make decisions I disagree with, they are most often both reasonable and perspicacious. They want to safeguard both the financial security and neighborly feeling of their communities. And residents are mostly appreciative of the work their Board members, who are all volunteers, do on behalf of the building. In the end, the Board application process is not a high price pay for the pleasure of the well run community into which you integrate yourself as a co-op resident.

Next week I will write about preparing a Board package and lay out clearly the steps which can be taken to simplify and  demythologize the process.