Quote:
Originally Posted by Andrewjm3D
You know this for a fact? Did you read this somewhere? You can speak for all rich people in NYC?
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There are 2 main reasons why rich, often older, people tend to prefer Co-ops in NYC (and they still do; much of the high-end new stuff is co-op):
1) Buyer needs lots of cash on hand. Getting a loan for more than 50% of the purchase price for a co-op is difficult, sometimes getting 25% is hard;
2) Exclusivity. They can be selective about who moves in. Having funds available isn't enough to buy shares in a co-op; you need to make it through their application process and typically need a reference or two from people who already live in the building.
In short, with a co-op you pay millions of dollars so you get to select who your neighbours will be. Since you're selecting a business partner with common liability, you can be very selective. This tends to keep out recent lottery winners and the unruly youth with large inheritance.
It's harder to setup exclusivity in a condominium without running into discrimination laws. You seldom have a multiple-stage interview process focused on your lifestyle with building management and the condominium board before being allowed to purchase a unit.