News & Noteworthy

Article - Bruce Bronster Addresses 'Flip Tax' in New York Times "Ask Real Estate" Column
MAY 20, 2014 | The New York Times

The May 15, 2014 edition of The New York Times "Ask Real Estate: All About Fees" column featured insight from Bruce Bronster (Partner, New York) in response to the following question about a flip tax:

Q. About 10 years ago, shareholders in my co-op rejected an amendment to the proprietary lease to enact a flip tax. So the board instituted a flat $500 administrative fee whenever a property is sold. A few years later, the board replaced the flat fee with a $5 per share fee, calling it a "modest administrative fee." Recently, the board increased this fee to $15 per share, which translates to about $3,000 for an average shareholder. This seems like more than a "modest administrative fee" and looks like a "flip tax". Do you agree and what is my recourse?

While it may be tempting for co-op shareholders to fight such a tax, Bruce notes:

  • "This is a tempest in a teapot. If they can't get the flip tax and they need the money, what else are they going to do?"

Read the full article.

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