Conflict of Interest Laws in Cooperative and Condo Boards Amended by NYS Senate

Conflict of Interest in NYC boardsEffective January 1, 2018 the New York State Business Corporation Law will be amended to reflect that cooperative and condominium housing corporations must submit an annual report to the members of their governing board regarding any contracts entered into with interested directors.  The bill which you can read here and introduced by Senator Martin Golden states that the new reporting must include the following:

  1. A list of all contracts voted on by the board of directors, including information on the contract recipient, contract amount, and the purpose of entering into the contract;
  2. The record of each meeting including director attendance, voting records for contracts, and how each director voted on such contracts; and
  3. The date of each vote on each contract, and the date the contract would be and remain valid.

Condo and co-op  boards have been entrusted by apartment owners with responsibility for managing the affairs of entire building. Boards have meetings periodically to make decisions that involve the overall health of the building.  From deciding who their property management company will be to picking the color of the walls in the hallways it is the boards responsibility to make these decisions that affect all owners of the building.  As the board members become fiduciaries for the owners it is in their interest to decide on such issues in good faith and not for personal gain.  When a director acts for personal gain or have business or familial relations with individuals or companies the board contracts with there may be a contract of interest.  The bill seeks to end these relationships.

Senator Golden stated in support of the bill:

 “Cooperative housing boards of directors are supposed to be representative of the housing development and are trusted with promoting the best interest of the co-op tenants. However, that is not always the case. In some instances, a member of the board may be benefiting financially or by other means when a contract between a cooperative housing development and a third party is entered into. This bill would establish a notification requirement so members of a co-op board are aware of existing laws. In addition, the bill would require disclosure of any contracts that were voted on… That way, co-op tenants as well as the board directors can be sure of the integrity of the management as it relates to contracts.”

Developers may be the ones most affected by the new law as newly formed boards work primarily with the developer and it other entities.  Property management companies should also be aware of this should they have other entities that contract with the boards.  The bill will now be headed to Governor Andrew Cuomo who is expected to sign it.

Boards interested in seeking new property management for your building Blue Harbour Property Management can be of assistance.  We are a full service NYC building management company with buildings in Queens, Brooklyn, Manhattan and the Bronx.

Preparing Your NYC Rental Property For the Fall Season

Preventative Fall Cleaning NYCThe weather is finally changing in New York City.  We have gone from the lazy days of Summer with sweltering heat to gradual changes in temperature that will eventually result in freezing temperature entering the holiday season.  With these changes also comes additional responsibilities for the New York City property manager.  We believe that there are several inspections that can be performed that will potentially save you from headaches and money in the future.

The beautiful changes in the colors of the leaves also means that a bountiful amount of them will begin falling onto your property and around it. The leaves can sometime clog gutters which can result in damage to the roof of the property, excess flooding and water damage in general.  Doing an inspection of the gutters and roof is an important objective for the property management company.  The beginning of autumn is the start of hurricane season and we have seen from Hurricane Sandy that the New York City metropolitan area can be affected by it.  What the inspector should be looking for are leaks and destroyed and/or damaged shingles on the roof.  The inspector should also be looking for gutters that are in disrepair and potential clogging.

The second issue that needs to be addressed is the heating of the premises.  As we know, there is a dramatic change in temperatures here in New York City.  One week we will see beautiful 80-degree temperatures and within 7 days have seen changes of temps of up to 40 degrees.

Preventative Fall Maintenance NYCWith these changes in the weather, property management companies should do an annual heating checkup.  This includes inspecting the boiler, water heater as well as the furnace.  By doing this, you can troubleshoot any issues that may arise when the cold weather hits.  Troubleshooting issues can potentially save you money in energy costs by remediating anything that is in disrepair. It is also important to inspect the chimney to see if there are any issues there.  Annual cleanings are sometimes necessary and it will give you an opportunity of clearing any debris that has accumulated during the year.

Finally, your inspection should be focused on the exterior of the premises.  Falling trees and limbs can create hazards with heavy rains and increased storm winds.  You should determine what portions of the tree is healthy for these conditions.  If the entire tree needs to be taken down then it should be considered as well.  Hiring a professional landscaper that has expertise in tree services can assist you if you are not familiar with what would constitute unhealthy tree conditions.  They will be able to inspect, trim or remove if they see what can potentially be a costly condition for your property and tenants.

Taking preventative measures early in the fall season can save yourself and landlords time and money in the long run.  If you are in need of an experienced NYC property management company for your rental property that can assist your preparing for the Fall Season than Blue Harbour Property Management might be for you.  We are an experienced property management company servicing Queens, Brooklyn, Manhattan and the Bronx.

Queens Housing Sales Outpaces Brooklyn and Manhattan; Rents Remain Cool

Queens real estate outpace Brooklyn, ManhattanA new report published by StreetEasy indicates that Queens housing sales remained competitive in comparison to Manhattan and Brooklyn.  According to the August 2017 Market Reports, sales in Queens were completed 6 days faster year over year.  Homes in the borough spent a median of 53 days in the market.  In 2016 houses spent a median of 59 days.  The report also indicates that the median resale price in Queens increased by 7.4 percent to $503,864. The fastest pace was in the Rockaways which increased at the fastest pace at 15.6 percent.

The report indicates that Manhattan and Brooklyn properties did not fare as well as Queens.  Properties in these boroughs stayed on the market significantly longer than the same period last year.   Manhattan properties spent 14 days more in the market to 84 days.  Brooklyn properties also remained on the market but for less time at 68 days or 8 days more than in 2016.  According to Senior Economist Grant Long at StreetEasy :

“The glut of luxury housing in Manhattan and Brooklyn has been a key driver of the slower-moving markets in those areas.  More affordable housing options are still limited and as a result, New Yorkers are increasingly turning to Queens for the best deals, causing home prices and competition there to spike.”

Queens real estate outpaces Brooklyn and ManhattanOf significance NYC property management companies are rents fluctuations in the boroughs.  In Manhattan, median asking rents rose 0.6 percent from August 2016 to $2,992.  Fastest rent growths were in Upper Manhattan.  As for Brooklyn asking rents rose 1.1 percent to $2,459.  Rents are up 1.4 percent year over year however according to StreetEasy “Despite Queens rents rising more than those in Manhattan and Brooklyn, its pace of price growth was the slowest on record: up 1.4 percent year-over-year to $1,998.”

If you are purchasing a property and are in need of a NYC property management company then contact Blue Harbour Property Management.  We are a full-service NYC residential property management company servicing Queens, Brooklyn, Manhattan and the Bronx.

 

What NYC Property Management Companies Should Do To Avoid The Claim of Security Deposits

security deposits nycAs a NYC property management company or landlord sometimes claiming a tenant’s security deposit is more work than actually releasing it.  Many instances lead to lawsuits where the tenants feel that they are entitled for the release of the initial deposit.  This can lead to wasted time by yourself or employees and monies lost for retaining a lawyer. So how do you avoid this situation?  Communication has always been the major part of getting out of this jam.  By communicating with your tenants during their tenancy it can save you time and money lost and hurt feelings at the end of the day.  Below is some other ways to avoid claiming the security deposit at the end of the lease term.

The lease should be explicit on the responsibilities of all parties

Besides speaking to your tenant about expectations, the lease should clearly delineate the reponsibilites of all parties to the lease.  I normally set up a section and write in bold what the expectations are. Doing this will avoid having problems in the future where there might be a disagreement of whether a certain function was the property management company or tenant’s resposibility.  Nipping issues in the bud can save your money and time.

Always provide a move-in inspection with your new tenant

I have learned as a NYC property manager that move-in inspections are important.  What started as just filling out a check-list has now turned into a more thorough inspection.  With smartphones having the ability to capture photos and videos, I now can take pictures of the property as well as have in-depth videos if need be.  By capturing the condition of the premises, it is easier proof should you need to bring in evidence in Court.  It also can be a deterrance in legal action if you can show the pictures to your tenant and explain when the photos were taken.  Sometimes their memory is foggy as well and it can definitely refresh their recollection.

 

 

security deposits nycBi-annual inspections of the units

As a property management company in NYC it can be a chore to make sure that all your managed units are in a great condition.  It takes a dedicated staff of professionals to implement policies and enforce them to make sure that you are doing what is necessary to ensure that all of your units are in a favorable light.  It is important to express to your tenants that you will do inspections of the premises at least every six months.  By doing so, it will allow you to see if your tenants are taking care of the premises.  It will also allow you to troubleshoot any issues that might arise in the future and remediate them.

Walk-through at the end of the lease term

It is your responsibility to do a walk-through of the premises at the end of the lease term.  You should do the inspection using the same level of detail that you did during the initial inspection with your tenants.  This should include both pictures and videos if necessary.  Many times in the past we have used these pictures in Court in the event there is a legal case with reference to the security deposit.  Having the tenants sign off on the report is also important as they will acknowledge the condition of the premises at the time of giving back possession.

Taking these steps will help you avoid many painful days in the future.  By keeping detailed records it will only assist you in retaining the security deposit if necessary.  However it is always best that your tenant’s expectations are clear to avoid this.

If you are in need of a NYC property management company than Blue Harbour Property Management is for you.  We are an experienced full-service NYC building management company managing properties in Manhattan, Queens, Brooklyn and the Bronx.  Call us at 718-843-1185 for a free consultation.

Home Prices Breaks Highs of 2016 As Demand Outstrips Supply

Home Sales Price IncreasesHome prices nationwide has increased by 6.2% from the second quarter of 2016 as the price of $255,600 hits peak levels.  The new report by the National Association of Realtors (NAR) indicates that as a result of low supply of housing, prices has remained strong and grown in 87 percent of measured markets.  According to the report, sale prices have increased in 154 out of 178 metropolitan areas from the same quarter last year.

Total existing-home sales which includes single family and condos, slipped 0.9 percent to a seasonally adjusted annual rate of 5.57 million in the second quarter from 5.62 million in the first quarter.  The sales figures are still 1.6 percent higher than the 5.48 million pace during the second quarter of 2016. Both of the figures aboves indicates that there is a need for newly constructed projects.  NAR chief economist stated “The glaring need for more new home construction is creating an affordability crisis that needs to be addressed by policy officials and local governments. An increasing share of would-be buyers are being priced out of the market and are unable to experience the wealth building benefits of homeownership”.

Home Sales Price IncreaseOf significance in the New York City region and the Northeast, total existing-home sales in the Northeast rose 1.3 percent in the second quarter. The median existing single-family home price in the Northeast was $282,300 in the second quarter, up 3.2 percent from a year ago.  Metro area condominium and cooperative prices, showed the national median existing-condo price was $239,500 in the second quarter, up 5.4 percent from the second quarter of 2016 ($227,200). Eighty-seven percent of metro areas showed gains in their median condo price from a year ago.  A recent report by the Real Deal Magazine indicates that up to forty percent (40%) increases in Flushing, Queens alone.  This will affect NYC property management companies as rents are affected by existing home sales prices and mortgages.

 

 

Cash Sales for Homes Heat Up as Inventory Remains Low

Cash Sales HigherThe housing market remains healthy as a new report by Freddie Mac indicates that the lack of inventory of houses is at a two month supply in larger cities.  Freddie Mac’s outlook for August also indicates that because of the highly competitive market it is causing many more people to offer cash sales reducing mortgage originations.

Cash sales made up about eighteen percent (18%) of total home sales for June.  This is an increase of the historical average of ten percent (10%).  The result is there is a loss in mortgage originations of $172 billion because cash sales are above historic norms.   “During the financial crisis, the combination of depressed house prices and tighter underwriting drove the share of cash sales as high as thirty-five percent (35%)” according to Freddie Mac.

The report also states:

“Usually, not many people like to invest a lot of cash into real estate, which is illiquid and has high transaction costs. However, in the current, highly-competitive housing market, a cash offer is an effective way to gain an advantage over other bidders. In a cash sale, the seller doesn’t have to worry about the buyer’s ability to obtain a mortgage or the chances that an appraisal will come in below the agreed sales price. Cash offers also are more common in purchases of investment property and second homes, where mortgage qualification requirements are stricter and mortgage terms are less attractive.”

Cash Sales HigherFreddie Mac also believes that home sales will reach 6.2 million units this year.  This would be a three percent (3%) increase year over year. The market is primarily being stifled from growth potential by the supply in the housing market.

If you are purchasing a property and are in need of a NYC property management company then contact Blue Harbour Property Management.  We are a full service NYC residential property management firm servicing Queens, Brooklyn, Manhattan and the Bronx.

 

Avoidable Mistakes for the First Time NYC Real Estate Investor

Real Estate Investing NYCWhen investing in real estate in New York City, it is common to think that you will turn a serious profit with a quick flip.  Having that mentality has worked in the past but now more than ever it is important to have a long-term strategy in investing in real estate in New York City.  The gains that you will receive normally come from solid real estate investment strategies which include increasing the value of your holdings by hiring a reputable New York City property manager.  Hiring the right property management company will only enhance your ability in building equity and increasing passive income. 

Quick returns as we have mentioned are rare.  Many people go and come out of the real estate investment industry quickly because they never received the returns they were expecting or outright lost money.  So what are some common mistakes that we see from first time real estate investors?

Purchasing a property you wouldn’t think is suitable for yourself

If you cannot imagine yourself living in the house you are considering purchasing then you shouldn’t.  The question I always ask clients is “What if something catastrophic happens…would you live there?” If the answer to the question is no then the property isn’t the right fit for you.  The goal on your purchase is to find something that tenants would be receptive to.  If you are not that interested, than this would be a clear sign that you wouldn’t be as energetic into the investment.   

Not having “rainy day” money for emergencies

There are many times that I have seen investors go into a transaction with zero reserves.  This would put a strangle on your personally if you do this.  You should account for basic monthly expenses as well as have a reserve on hand in the event of a unforeseen repair or expense.  You should always take into account utilities expenses and general maintenance fees such as the property management and landscaping.  You should also have a cash reserve fund in place in the event that a tenant decides not to pay rent for instance or the boiler needs an emergency repair.  The failure to do this can result in potential withholding of rent.  Also you will also have to tap into your personal money to fix such as a retirement account or credit card which will affect you and your family for potentially years.  

Real Estate Investing NYCTaking it personal and forgetting the bottom line

At the end of the day, owning a rental property in New York City is nothing more than business.  You should treat it that way and not let your emotions run your decisions.  Sometime it can seem personal when you have tenants and they want to tell you their life stories for their failure to pay the rent.  You have to be tough and always treat the managing of your property like your own business.  A top-notch NYC property management company can assist you in staying on course with your objectives.  They will also lighten your load and allow you to concentrate on other pressing issues that you may or may not have.  This can result in shedding the burdens that you may have and allow you to purchase additional rental properties.  

Addressing these common mistakes will help you along your way in being a successful real estate investor.  Sure there are other variables at place in maximizing your returns but by focusing on the tips above will help you in achieving your long term goals.

If you are in need of property management in New York City for your real estate purchase, Blue Harbour Property Management can assist you.  Contact us at 718-843-1185 or email at [email protected]

NYC Commercial Property Recycling Fines Has Begun Effective August 1

Commercial recycling NYCThe City has finally begun enforcing their new commercial recycling rules which has taken effective since August 1, 2017.  The rules which have been taken hold after a year long implementation period requires all types of buildings to segregate recyclable paper refuse from metal, glass and plastic containers as well as from disposable materials such as plastic bags and Styrofoam. If at least 10% of a building’s trash consists of textiles and food waste, the owner also will be responsible for filtering out that material and arranging for its proper removal.  Businesses can decide whether they want to collect all recyclables together or they can separate as long as recyclable materials are kept separate from trash at all times. The fines for non-compliance will begin at $100 and will increase to $400 for the third violation.

“The city’s goal is to make recycling consistent at home, at work and at play,” says Bridget Anderson, Deputy Commissioner, Recycling and Sustainability, NYC Department of Sanitation (DSNY). “Commercial recycling rules used to be different from the residential rules. Now they are consistent.”

Commercial landlords and property management companies will bear the responsibility of designating containers for each of the different varieties of refuse and inform tenants, building staff and their private carting service on how to use them. According to Crain’s New York Business  the Department of Sanitation estimates that out of the 9,000 tons of waste generated daily by businesses, up to 54 percent can be recycled. An additional organics component could increase that number up to an incredible 89 percent they calculate.  The City also believes that these new rules will facilitate in meeting their goals in zero waste in landfills by 2030.

Commercial Recycling NYCThe City is attempted for businesses to get up to speed with the new rules.  NYC property managers and landlords can visit nyc.gov/zerowastebusinesses and on.nyc.gov/zerowaste-business-resources to sign up for a free training, host a training, or download signs and education materials. To contact DSNY or request a business recycling training, email [email protected].

 

Pending Home Sales Breaks Trend and Increases in June

Pending Home Sales June 2017The National Association of Realtors (NAR) is reporting that pending home sales increased in June 2017 which is bucks a three month trend of decreased contract activity from the same time a year ago.  NAR used a pending home sales index which rose 1.5 percent in June to 110.2.  The index has increased 0.5 percent over the past 12 months and for the first time since March.  All major regions saw an increase of activity except the Midwest according to the report.

Lawrence Yun, chief economist for the NAR believes that low supply is hampering an increase in activity although the nation has 2.2 million net new jobs.  He states “Low supply is an ongoing issue holding back activity. Housing inventory declined last month and is a staggering 7.1 percent lower than a year ago.  Market conditions in many areas continue to be fast paced, with few properties to choose from, which is forcing buyers to act almost immediately on an available home that fits their criteria.”  There were 1.96 million homes for sale in June, a 7.1 percent decline from a year ago.

Pending Home Sales June 2017Of particular interest here in the Northeast, the pending home sales index indicates a 0.7% increase in activity from the previous month and 2.9% increase year to year.  The NAR considers Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont as comprising the Northeast.

Yun expects existing-home sales to finish around 5.56 million, which is an increase of 2.6 percent from 2016 (5.45 million). The national median existing-home price this year is expected to increase around 5 percent. In 2016, existing sales increased 3.8 percent and prices rose 5.1 percent according the the report.  The median sales price is currently at $263,800 an increase of 6.5% year over year.

The Pending Home Sales Index is an idex devised by the National Association of Realtors for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed.  The index is based on a national sample, typically representing about 20 percent of transactions for existing-home sales.

 

 

Tips On Handling Central Air Conditioning Units for Property Managers

AC unit repair NYC property managementWe are now into the hazy days of August here in New York City.  The temperature this summer in the city has been rather mild in comparison to some other years.  Although that may be the case, the temperatures can be somewhat stifling to some without air conditioning.  This is especially true for the elderly and persons that have lost their mobility.  Having your air conditioning units running correctly may be a case of life or death for some and doing so correctly should be a priority for property managers as well as landlords.

While we may be in the clear going into August, maybe now is the time to think about servicing your AC units for the next year.  Most home central air conditioning units which include a condenser.  You may notice this when it is sitting on a pad on the outside of your.  Along with the condenser, the evaporator is located on the inside of the premises.  The majority of the time, it is the condenser that has the issues that creates turmoil for your tenants.  Here are some tips in order to have them run efficiently in the event it stops working:

  1. Once you have turned off the unit, you can remove the outer case of the condenser in order clean the fins.  Because you have four seasons here in New York City, you can potentially have evidence of this in leaves, grass, twigs and garbage that can clog up the fins.
  2. Lubricate the motor to the fan ports.  You can do this by using oil for electric motors.  It is easily found in hardware stores.
  3. Check for evidence of damage to your unit.  It is advisable to look for leaks and cracks.  Specifally it would be a clear indication of a problem if you see an oil or coolant leak.

With respect to the evaporator you should alway check and replace air filters.  It is advisable to replace the filter as follows:

  1. In a vacation home or single occupant home you should replace the filter every 6-12 months.
  2. Regular sized home without any pets the filter should be replaced every 90 days.  With 1 pet it should be replaced every 60 days and adding an additional pet the time period should be adjusted downward by 50%.

NYC property management AC unitsMost people are not knowledgable nor want to put themselves in a position of doing the work to service their AC unit.  If that is the case, then hiring a professional HVAC professional to remediate an issues with your unit.  If you have rental properties and tenants are complaining about the air conditioning then a respectable New York City property management company can schedule and handle all the issues of your unit so you don’t have to.  For more information, you can contact our highly skilled staff of New York City property managers.