“It’s a Catch-22, since they can’t earn more than a certain amount, but cannot qualify for financing at that income unless they make a massive down payment,” Christopher Stanley, an associate broker with the Corcoran Group, who recently sold a $510,000 one-bedroom in Hell’s Kitchen that required the buyer to pay in cash yet earn no more than $67,000 a year, told the New York Times. “Everybody wanted to buy, but most people could not qualify.”
Co-ops in the Housing Development Fund Corporation, or HDFC, were originally intended for low-income New Yorkers, mostly on the Lower East Side and in Upper Manhattan, Brooklyn and the South Bronx.
Back when they were created in the 1970s, many of the apartments were sold for just $250 each, and, to keep them affordable, income ceilings were imposed on resales. An estimated 25,800 of these apartments still exist today.
But now that many of these co-ops list for well over $300,000, finding a buyer with that kind of cash and middle-class income can be a formidable challenge.
“You needed to be income poor, but savings rich,” said Gary Cowling, an actor, who met the $67,000 income cap for a Hell’s Kitchen co-op. “Acting and teaching does not make a lot of money.” [NYT] – Christopher Cameron