WHAT IS CONSIDERED NEW RESIDENTIAL DEVELOPMENT?
In New York, this is a residential offering that is completely new to the market, and must be approved by state and local governments. It includes both ground-up construction and the conversion of an existing structure, such as an office building or rental property.
WHAT IS A ‘SPONSOR'?
The legal entity that owns the new development being offered-considered "the seller."
WHAT IS AN ‘OFFERING PLAN'?
A comprehensive disclosure document provided by the Sponsor and approved by the Office of the Attorney General of the State of New York ("Attorney General") that describes the property's offering.
WHAT IS AN ‘OFFERING PLAN AMENDMENT'?
A modification to the Offering Plan that is filed with and accepted by the Attorney General. Amendments are issued over time as material changes are made to the Offering Plan.
WHAT IS A ‘PURCHASE AGREEMENT'?
A legal agreement between a Purchaser and Sponsor detailing the conditions of the sale of property, including price and terms.
HOW IS AN OFFER MADE?
Offers are made in writing and submitted to the development's onsite salesperson by the buyer's real estate agent.
HOW DOES AN ACCEPTED OFFER GO INTO CONTRACT?
Once an offer is accepted by the Sponsor, the onsite salesperson requests contact information for the purchaser. The Sponsor's attorney draws up the Purchase Agreement. The Purchase Agreement and Offering Plan are then sent to the purchaser's attorney for review. Once both parties have signed the Purchase Agreement and the Sponsor receives a down payment, the residence is considered "in contract."
HOW IS A DOWN PAYMENT MADE IN NEW DEVELOPMENT?
Typically, this is a percentage of the purchase price. Often, it is paid in the form of a certified check or wired into an escrow account set up by the Sponsor's attorney.
WHAT IS THE DIFFERENCE BETWEEN COMMON CHARGES AND MAINTENANCE FEES?
Common Charges are monthly dues in condominiums, the most common form of new development. Maintenance Fees pertain to cooperatives.
FOR CONDOMINIUM BUYERS, WHAT ITEMS ARE COVERED BY MONTHLY COMMON CHARGES?
Common Charges are the monthly charges allocated to each residence and paid to the condominium in order to cover the pro-rata share of the condominium operating expenses. This does not include the unit owner's real estate taxes which are billed separately to each owner. As the cost of operating the building changes over time, Common Charges are also subject to change.