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Minimum Resale PriceDec 28, 2017

My Coop requires minimum resale value which are unrealistic. Often, units are on the market for months and some for over a year. Do I have any legal recourse.

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Minimum Resale Price - Marty Dec 29, 2017

Is this a written policy? If not, how do you know there is a minimum resale price? Has a Board member (or management person) explicitly told you that there is a minimum resale price? Are YOU a Board member?

If this is true, why are applications allowed to be submitted if the minimum asking price is not being met? That seems like a waste of everyone's time.

We have often had units up for sale for quite some time. That can often be due to factors other than the price, like inferior applicants being submitted to purchase the apartment, which is the fault of the broker.

I can only speak from my own experience, but all apartments are not created equal. Some have been renovated, some have not. Some are in better condition than others.

It seems unreasonable to apply one standard of a minimum price while ignoring other factors that can affect the asking price.

As far as legal recourse, I can only see this taking place if there is absolute proof that a minimum resale price policy has been expressly stated in words or verbally. If it's verbal, that will be much harder to prove.

If you are not a Board member, have you asked the Board why this policy is in effect?

I can only suggest that if you know of other shareholders who have been "victimized" by this policy, you should request permission for all of you to speak at the next monthly Board meting and ask the Board these questions.

You can also band together and bring this topic up at your next Annual Meeting. Perhaps you and other like minded people should run for the Board and change this policy.

Good luck to you.

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> Join the conversation Comments (1)
Minimum Co-op Resale Price - Steven424 Dec 29, 2017

Marty - I agree with your response to the original post, but I can think of another, more sinister reason why a board would impose a "minimum sales price", written or otherwise. They have an inflated or unrealistic sense of what a typical unit in their building *should* sell for, because they think anything lower affects all future apartment sale prices base on comparables.

Some boards feel that if an apartment sells for significantly below the average comparable price, the effect is to force subsequent sales to start with a lower asking price. The board may have also heard from a family member, friend, or whatever source what their apartments *should* be worth. Say, over a $1 million, so they arbitrarily set that as the floor in the misguided belief that a lower selling price will adversely affect future sales.

So, as you pointed out, it becomes a question of what a board can legally do to set and enforce a minimum sales price. I feel only an attorney can answer this question. It may be that rejecting purchases based solely on final contract price is an actionable form of discrimination against sellers whose apartment is not appraised to meet the minimum. It may be there is some regulation somewhere preventing rejection bases entirely on price. Or it may be that the Business Judgment Rule gives a board wide latitude in deciding what is "best" for the co-op, and the original poster is plain out of luck.

The wording of the original question makes it sound like there is an official or quasi-official policy in place regarding minimum sales price that is based only on dollar amounts, and does not take into account any of the other factors you mentioned. If the board is dug in on this, an attorney may be the only recourse left.

I totally agree with your suggestion that if a shareholder does not like the way the co-op is being run, they should run for the board.

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