FREQUENTLY ASKED QUESTIONS
Q: Why should I buy at the River House?
A: For the value. At the River House, your co-op unit will be spacious, light and airy; facilities and grounds cared for and well maintained; and you will have recreational activities at your door. It also enjoys one of the most convenient locations in the county, is astutely operated by a talented board and managed by a professional company, and is one of the most financially sound cooperative complexes in the state with no underlying mortgage and a strong cash reserve—which helps when applying for a private mortgage.
Q: What is a cooperative apartment?
A: The best way to understand cooperative ownership is to compare it to owning a condominium, as follows:
Condominiums: Generally, when one purchases a condo, they literally purchase the physical unit of the condo and pay monthly Homeowners’ Association fees (HOA) that basically cover maintenance of all common areas and staff compensation. All real estate and school taxes are billed separately, as are heat and hot water. So, in the case of a condo, one might pay a private mortgage, homeowners association fees (HOA), all real estate and school taxes, and heat and hot water.
Co-op: When one purchases a co-op apartment, however, he or she is purchasing a certain number of shares within the corporation, depending on size and location of the unit. In addition, there is a monthly maintenance fee that is basically higher than a condo’s monthly HOA fee but, the difference is that, the co-op maintenance fee is an umbrella amount that covers “everything.” This includes all real estate and school taxes, staff compensation, maintenance of common areas, plus heat and hot water. So, in a co-op, the owner may pay a private mortgage, plus a co-op maintenance fee that includes all taxes, heat and hot water, and maintenance of all common areas by staff and other personnel. As with a condo or a single family home, a co-op’s real estate and school taxes are tax deductible on Federal Income Tax Returns; and eligible for NYS STAR and Vet refunds. And, as is the case with a condo or single family home, when one wants to sell their apartment, they do so through a real estate agent and not a stock broker.
Q: How is a co-op governed?
A: A cooperative residence is governed by an elected Board of Directors who are usually shareowners of the same corporation. They do not receive salaries or any other compensation when they serve. At the River House, there are seven members, including four officers (president, vice president, treasurer and secretary). Every year there is Annual Shareowners Meeting to elect candidates running for the first time or re-elect incumbent board members. At a later point, soon after the meeting, it is determined by the elected board members as to who will be the four designated officers, as an election process within the board itself. It is their job to handle daily operations, set corporate policy and adhere to the Bylaws of the Corporation, among other responsibilities and situations that might arise.
Q: How is a co-op managed?
A: Cooperative apartment complexes may be managed by a hired individual who serves as an independent contractor or payroll employee; or the complex may be managed by a management company whose business is to professionally oversee complexes of this type. The River House, for instance, is managed by Hudson North Management, LLC, a professional management company deemed be a more cost-effective direction for the co-op, with far more services and expertise than an individual could provide. Benefits derived from a professional management company are many and include year-round management without the monetary compensation of vacation and sick time that would be normally allocated to a payroll employee, among other advantageous considerations.
Q: What are the benefits of home ownership in a coop?
A: Purchasing a cooperative residence can be an even better choice in home ownership because, as is the case at the River House, all perspective buyers are thoroughly screened and go through a criminal, credit, financial and reference check in order to establish their suitability as shareowners and neighbors. The biggest benefit, however, is that co-op apartments offer more value for the money. And, it’s important to underscore the point that although its monthly maintenance fee is higher than a condominium’s monthly home association dues, co-op maintenance fees include heat and hot water, real estate taxes, school taxes, maintenance of grounds and public areas, and compensation for staff. And, a good portion of it is tax deductible and subject to various discounts including NYS STAR and Vet refund programs.
Q: How financially sound is the River House?
A: The River House proudly states that it has no underlying mortgage, which is very rare for co-ops and very significant when shareowners first apply for a private mortgage for their desired unit. It is believed to be one of the few co-ops in the state to be mortgage-free.
While no Board can guarantee the future financial outlook of any cooperative complex, nor can it prevent any extreme circumstance or emergency that might arise, it is the Board’s overall position to practice prudent financial measures through careful planning and anticipation of future projects.
Q: How does the Board raise money to pay bills, salaries and manage the building?
A: Basically, through monthly maintenance fees paid by the shareowner. Additional funds are collected from a recently instituted Capital Improvement Fund and an Annual Sublet Fee, and other sources of income (additional parking spaces, laundry facilities, leased storage, etc.).
Q: Can maintenance fees ever be lowered?
A: Thanks to the NYS STAR and Vet refund programs, cooperative homes are eligible for a considerable reduction in real estate and school taxes which, consequently, reduces the shareowner’s monthly maintenance fee. STAR includes the Basic reduction allotted to shareowners under the age of 65, while Enhanced STAR involves a greater reduction for those over 65 years of age. Furthermore, a Veteran’s reduction in real estate and school taxes would also apply to those who served in the armed forces during wartime.
Q: Can a new buyer sublet their apartment?
A: The answer is no. Sublets are no longer allowed at River House. Our current owner-occupied/sublet ratio is well under 5 percent and decreasing. The Board’s goal it to make River House 100 percent owner occupied within a few years. The greater number of owner occupied apartments the more desirable the Coop complex. Banks also look upon our existing owner-occupied/subtenant ratio very favorably. This makes it easier for prospective buyers to acquire mortgage loans, or for existing shareowners to refinance their apartments.
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