Joining your condo or co-op board in NYC is a great way to influence both the direction and finances of your building. However, there are also some downsides to being a board member. We discuss the pros and cons of joining your condo or co-op board in this article.
Being on the board is particularly important in a smaller building. This is because individual unit owners in smaller buildings feel the financial impact of board decisions much more directly.
For example, if the board of a 10 unit building overpays on a roof repair project by $50,000, this costs each unit owner approximately $5,000.
If you are in a larger building with 50 or 100 or more units, each individual unit owner’s cost of a bad board decision is much less significant.
Being a board member also allows you to influence the types of projects which the building undertakes. For example, should your building prioritize the installation of a video intercom system or spend the same amount retiling the floor in the lobby? What brand intercom should the building use? What tile pattern should be used in the lobby? Will it be porcelain or natural stone?
Joining your condo or co-op board is also an excellent defensive measure against troublemakers in your building. This is particularly relevant for smaller condos and co-ops, where one or two owners on the board can make your life a living hell if you happen to offend them.
Being a board member yourself makes it much less likely for a board to ‘go rogue’ and initiate legal action or otherwise behave immaturely in response to a perceived grievance you may commit.
Let’s say, for example, you just closed on your apartment, and you know that several board members unsuccessfully attempted to buy your apartment before you sealed the deal with the seller.
Let’s also say that this apartment you purchase doesn’t have air conditioning. So, you submit an application to the condo to install an air conditioning compressor on the roof, since you observe that most other unit owners have the same type of air conditioning setup.
To your surprise however, the building’s managing agent denies your request and falsely claims that your installation method is illegal.
You know that management’s rationale is baseless, but since you’re not on the board, you have no influence over management and no ability to command the board’s full attention to discuss the issue. You also remember that you’re not the board’s biggest fan to begin with, since you bought the apartment which a few board members tried to purchase.
In response to this unequal treatment, you decide to install the compressor on the roof anyway.
In this real example, the board promptly retained a lawyer and initiated legal action against this owner, without even bothering to speak with the owner beforehand.
As the dispute grew, the board refused to speak with this owner for more than six months, and instead, they hid behind lawyers and wasted over $5,000 of the condo’s money in legal fees. Ironically, this condo building essentially had no reserve fund at the time it decided to go nuclear and ‘lawyer up’.
Let’s rewind and consider this: what would have happened in this scenario if this owner was on the board? Would the board still have unfairly denied the request of a fellow board member to install the same air conditioning system which most of these board members already had? We don’t think so.
These sorts of bizarre scenarios happen all the time in NYC, especially in smaller buildings where one or two neurotic owners might have outsized influence on the board. Therefore, joining the board can actually prevent these types of fiascos from happening to you in the first place.
In conclusion, consider joining the board as a defensive measure if you live in a small condo or co-op building in NYC.
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The primary disadvantage of being a board member is that building matters can consume a lot of your free time. It can actually be a lot of work, particularly if you’re an officer (President, Treasurer, etc.).
The moment you agree to oversee any sort of initiative, the other board members will usually back off and expect you to do all the work. Therefore, be careful what you volunteer to do.
At the same time, this autonomy can be really great if you have time and feel passionately about your vision for the direction of the building.
There’s also the issue of having to mediate disputes between owners and other grievances against the building. For example, let’s say one unit owner has decided to not pay her common charges out of protest for some dispute she’s having with another owner. Let’s say that this owner now owes over $20,000 to the condo, and the building is running out of money.
Whose responsibility is it to make this person pay? Normally, it’s the responsibility of the managing agent to chase unit owners for payment. However, management has very little upside in getting involved and going to war with an owner, particularly in a small building.
So management might send an email or two and then give up, and simply wait for the board to take care of it.
In this real example, one of the condo board members ended up having to call this owner and ask for payment. So as a board member, you might literally have to call your neighbor and persuade them to pay the condo $20,000 in unpaid common charges.
Board members also face a remote risk of personal liability in scenarios where the building is sued. If you join the board, you may be personally named in any lawsuit against the building.
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Board members are expected to set an example and follow the rules to a much greater degree than a typical unit owner. In other words, joining the board means you will be held to a higher standard when it comes to adhering to the house rules and or renovating your bathroom.
Therefore, think twice before joining the board if you plan on engaging in illegal AirBnb activity, holding rowdy parties or renovating your apartment without permits.