Do co-ops allow foreign buyers?

[chin]

Hi, I’ve learn a lot through reading Hauseit's website, how to buy a property in NYC and related links. Thank you so much firstly. Can you confirm that co-ops allow foreign buyers?

Secondly I would like to request a buyer’s agent with rebate to help me in all aspects. My requirement background is as below:

1) I am a foreigner and working in Taipei , Taiwan, non US citizen. First time to purchase property in the US. However, my families live in the NJ for years and they had purchase experience. I hope I can do most of the homework in purchasing property unless there is a must to show up in person. Then I would sort it out. 2) My purpose is to invest, not for myself living, however within a certain budget. The most important criteria is to sublease for rent to get a stable passive income. 3) I also did some research about Coop and Condo in NYC. So your suggested agent can skip lesson 101. 4) I would use my daughter name, Winnie, as purchaser and her income should be qualified for almost all Co-op type of property. That is, liberal subletting policy is critical if coop is in the recommend list. And so far, I do appreciate coop type as my investment target. 5) As for loan application, hopefully can apply. I am also fine with all cash buying depends upon the final terms. 6) Finally, I would prefer email as major communication tool due to time zone difference and native language. 7) Purchasing decision time, could be within 3 months if I am lucky enough under your assigned agent. Looking forward to hearing from you.

Best Rgds,
Chin

[HauseitAdmin]

Hi Alex, thank you so much for reaching out to us! How did you hear about us may we ask?

What is your budget and which neighborhoods are you interested in? How much cash would you be able to deploy? Are there any specific listings you’ve already found that our teams can help you with?

Co-op buildings are really designed for primary occupancy, and while some coops may allow pied-a-terres, most co-ops will have issues with foreign buyers. This is especially problematic if neither you nor your daughter are US Citizens or Permanent Residents. Sometimes, a case can be made for a foreign buyer that is living and working here and already has a work visa, such as the H1B. Or perhaps you could try screening for listing descriptions that mention "diplomats ok."

Thanks!

[chin]

Hi, Thanks for responding. Here are the replies:

1) I know Hauseit thru Google top result listing.

2) As for budget, It's flexible and all depend upon the rental income and easy of subletting.

3) As for neighbor, I think same answer as (2), as long as reasonable income & easy to rent out.

4) I could ready 350~400K cash.

5) I would like to get your suggested listing first because you are supposed to be more professional than me.

Feel free to ask question.

Best Rgds
Chin

[HauseitAdmin]

Thanks Alex! Have you spoken with a mortgage banker yet or gotten a mortgage pre-approval letter? If not, we’d be happy to connect with you with some mortgage bankers who specialize in foreign buyers such as HSBC.

As a foreign buyer, we highly recommend looking at condos only. Co-ops are meant for primary residency, and the vast majority of coops will have residency requirements of some sort. Furthermore, many co-ops may have requirements that make it difficult for non-US buyers to purchase, even though you plan to co-buy with your daughter. Please check out our guide on co-ops vs condos in NYC.

We've seen instances where foreign buyers on a work visa (H1B) on track to getting a Green Card (Permanent Residency) were able to get approved by a few, more liberal co-op buildings. But these cases typically warranted more scrutiny and the buyer had to have zero issues with financing and lots of assets and post closing liquidity.

Remember that co-ops are corporations, and the board of directors must keep the best interests of their shareholders in mind. As a result, co-op boards are generally pretty conservative. The last thing they want to do is to go after someone for late maintenance payments when that person isn't even in the country!

Can you confirm if your daughter is a US Permanent Resident or Citizen?

Do you have an approximate price range in mind?

Thank you!

[chin]

Hi,

The following as a reply for your questions:
1) mortgage banker, I do need your recommendation.
2) As a foreigner, I do hope to get Coop type first, unless all require Primary Residence. I do find some message from Zillow/Trulia, "Liberal subletting", "Investor Friendly", "Subleasing allowed"....Therefore, I do anticipate some property that meet my expectations.
3) My Daughter is not PR nor US-Citizen
4) For Condo type will serve as my lower priority.

Hope it would help you locating right agent for me.

BR
Chin

[HauseitAdmin]

Great! Our partner broker will reach out directly with next steps as well as some mortgage banker referrals.

In terms of property type, we highly recommend that you stick to condos because it will be extremely difficult if not impossible to find a co-op building that not only allows foreign purchasers, but also parents buying for children, unlimited subleasing from day one and no initial residency requirements. It's hard enough finding a co-op building that allows just one of these situations (like unlimited subletting), but it's essentially impossible to find a co-op building that allows all of these.

Furthermore, as we previously discussed, the few situations we've seen where co-ops approved a foreign buyer were situations where the foreign buyer lived and worked in the same city, had a work visa like a H1B visa, and was on track to getting a Green Card (Permanent Residency). It will be quite tough if not impossible to find a co-op building that will be open to a foreign buyer that is purely an investor.

We just want to set your expectations, and truly recommend investing in a condo instead as a foreign buyer in NYC. Thank you!

[chin]

Hi, noted your advice with thanks.

However, what if co-purchaser plan, I mean:

1) Winnie, my daughter, co-purchaser with her cousin, Ben, who is US-Citizen and working in NYC now.

Is it possible to use Ben & Winnie name and looking for those unit can subletting after 1 year residency by Ben?

[lower_nyc]

I would be highly surprised if a co-op in NYC approved a purchaser who is not a US Citizen, a Permanent Resident or in possession of a Work Visa. Furthermore, a co-op not a very good choice for a real estate investment in my opinion. A co-op can change its subletting policies at any time, and a co-op can always derail your life plans by unfairly rejecting a purchaser (or perhaps multiple purchasers) if and when you need to sell.

My recommendation would be to buy a condo if you really want to invest in real estate or to simply invest your money in a passive index fund!

[aslan]

To be honest, I still don't recommend this path because co-ops require in person board interviews for all co-purchasers, meaning you will have to fly in from Taiwan for the board interview. And it's not a sure thing at all that they will approve you guys, so there are some significant costs like airline tickets alone to consider.

The easy solution would be for your daughter's cousin Ben who is a U.S. Citizen to just buy it in his name only, and you and your daughter give him a gift. However, this would mean that you wouldn't be owners of the property. Furthermore, any large gifts made recently (typically within the last 2 months) are scrutinized by both co-op boards and banks. They want to make sure the source of funds is legitimate.

So to summarize, assuming that you wish to be at least co-owners of the property, this would still mean that the co-op board would have to approve a foreign buyer which is quite rare and unlikely. I highly recommend that you stick with condos.

Co-ops are simply not meant for foreign investors.

[lower_nyc]

To be honest, I still don't recommend this path because co-ops require in person board interviews for all co-purchasers, meaning you will have to fly in from Taiwan for the board interview. And it's not a sure thing at all that they will approve you guys, so there are some significant costs like airline tickets alone to consider.

The easy solution would be for your daughter's cousin Ben who is a U.S. Citizen to just buy it in his name only, and you and your daughter give him a gift. However, this would mean that you wouldn't be owners of the property. Furthermore, any large gifts made recently (typically within the last 2 months) are scrutinized by both co-op boards and banks. They want to make sure the source of funds is legitimate.

So to summarize, assuming that you wish to be at least co-owners of the property, this would still mean that the co-op board would have to approve a foreign buyer which is quite rare and unlikely. I highly recommend that you stick with condos.

Co-ops are simply not meant for foreign investors.

This is great insight, aslan. Completely agree with everything you're saying here. The bottom line is: stay away from co-ops if you're looking to buy an investment property!