I wonder if Co-ops will become more popular now that the famous 80-20 rule has been changed by the
Mortgage Forgiveness Debt Relief Act of 2007. As author Patricia Hughes Mills explains in her new Special Alert on the subject: "…prior to the Act, the cooperative’s non-member income could be no more than 20 percent of its total gross income, in order for its stockholders to deduct real estate taxes and interest. This resulted in cooperatives renting space to commercial tenants at below-market rates in order to comply with the income test, or risk losing their cooperative status…." Because the changes to the rule open the door for more commercial income, it's been speculated that residents' costs will go down or buildings will be able to provide better services for residents (Co-ops Reap Unexpected Bonanza, NY Times, 1/20/2008
http://www.nytimes.com/2008/01/20/realestate/20cov.html?ex=1358398800&en=6b8f3300af5606b6&ei=5124&partner=permalink&exprod=permalink)
Something else that could make co-ops more popular in the State of New York--and condominiums, too--is a new bill that would raise the price of developers' filing fees in order to provide additional resources in the New York Attorney General's office. The bill's many proponents include attorneys for both home buyers and developers who anticipate that the additional resources would result in quicker reviews of offering plans by the AG's office and increased responsiveness to consumer complaints when home buyers face problems (A Fee That Developers Would Like to See Rise, NY Times, 2/6/2008
http://www.nytimes.com/2008/02/06/realestate/commercial/06fee.html?ex=1360040400&en=8899101aa629a5f5&ei=5124&partner=permalink&exprod=permalink)
Additional information about the
Mortgage Forgiveness Debt Relief Act of 2007 (MFDRA): It's 110 P.L. 142 (
110 P.L. 142), signed into law December 2007. A new LexisNexis® Expert Commentary by expert Gerald M. Levinson on MFDRA focuses on provisions of the act relating to forgiveness of mortgage debt (
see Gerald M. Levinson on the Mortgage Forgiveness Debt Relief Act of 2007,
Gerald M. Levinson on the Mortgage Forgiveness Debt Relief Act of 2007). Professor Mills's new special alert on MFDRA will appear in upcoming releases of Powell on Real Property® and Real Estate Financing, both published by LexisNexis.