For many New Yorkers, a condominium purchase is their first foray into the real estate market. It is important to understand that a condominium purchase is different than renting an apartment. All condominium offerings in New York are strictly regulated by the state Attorney General’s office. A developer must file a detailed offering plan that describes, among other things, the building’s construction, the amenities offered with the units, and any the features of any common areas. It is always a good idea to review a condominium’s entire offering plan—not just a sales brochure—before committing to buy a unit.
New York Loosens Rules on Out-of-State Condo Offerings
Any condominium offering marketed within the State of New York must first be reviewed by the Attorney General’s office. This includes any out-of-state condominiums. This means that if you live on Long Island and receive marketing materials from a company selling vacation condos in Florida, that is still considered an offering that must be registered with New York State. New York officials take this requirement very seriously. For example, last year the sponsors of a New Jersey condominium offering paid $33,000 in fines because they advertised (and sold) their units in Manhattan without first registering with the Attorney General.
However, the Attorney General’s office recently announced that it would modify its rules to make it possible for some out-of-state condos to market to New Yorkers without going through the full registration process. According to The Real Deal, a New York-based real estate news website, the Attorney General’s new policy will allow “out-of-state developers to skip parts of the offering plan review process...if the process in their home state (or country) is deemed to be adequate.” This means developers in states like New Jersey and Florida “will not need to redo certain time consuming and expensive stages of the application process” before they can sell their units to potential customers in New York.
Speak With a Long Island Real Estate Lawyer Before Buying a Condo
The new policy does not mean that potential New York condo buyers should be lax in carefully scrutinizing an offering plan before agreeing to buy a unit. It is always a good idea to consult with an experienced New York real estate lawyer before signing a purchase agreement. Condominium offering plans are complicated, often technical documents, and if you do not have experience with buying or selling real estate, you should not attempt to do so for the first time on your own.
Remember, an offering plan is often incomplete. There may be defects or problems with a particular unit that are not disclosed in the offering. You need to be aware of any such defects before you close the deal. Additionally, if the condominium’s sponsors may any representations regarding the condition of the building or the unit, you need to get such statements in writing. You should never rely on oral statements from a condominium sponsor, especially if they conflict with or contradict any written representations made in the offering plan.If you have any questions or concerns about a condominium purchase or any other type of real estate transaction, contact the offices of Nisar & Mason, P.C. to speak with a qualified attorney right away.