Maintenance fees with a Manhattan condo
Posted by Wei Min Tan on November 13, 2023
What are maintenance fees with a Manhattan, New York condo and what is reasonable?
With Manhattan condos, maintenance fees are known as common charges. When buying a condo, the monthly outflows are common charges and property taxes (collectively known as carrying cost). The average combined carrying cost with Manhattan condos is $2.70 per square foot per month. For example, let’s say you buy a 1,300 sqft two-bedroom condo. This means the average carrying cost is 1,300 x $2.70 = $3,510 per month.
High end new condos and old buildings tend to have higher carrying costs. What is deemed high? In my opinion, $3.00 per month or higher is high. Low is anything $2.50 or below. High end new developments have higher carrying costs because they tend to have a lot of amenities. Meanwhile, older buildings have higher carrying costs because they tend to need more repair reserves.
Deal example: Client’s luxury condo in Soho. Maintenance fee is high but the location, amenities and desirability outweigh the extra expense.
If you’re buying a Coop, then the term maintenance is appropriate. In a Coop building, the monthly maintenance expense is roughly the equivalent of the common charges, property taxes (as with a condo) and it also includes the building’s underlying mortgage. A condo building does not have an underlying mortgage. Hence theoretically, a Coop’s maintenance is higher than a Condo’s common charges and taxes.
These are just general guidelines. When looking at buying opportunities with clients, we always evaluate each condo’s carrying costs and overall financial feasibility on a case-by-case basis. As example, sometimes a condo may have higher carrying costs but it may make sense if the rent it commands is extra high, or the condo’s desirability outweighs the extra expense.
Weimin’s article, Manhattan property market trends
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