I finally got off the wait list for a Mitchell-Lama apartment, and now the building's going private. What can I do?
We often receive emails from readers asking for help in navigating their own real estate crises. In Realty Bites, we try to get them answers.
THE CONUNDRUM
After more than seven years on the waiting list, I won an appeal for an apartment in a Mitchell-Lama complex. However, the building is now going private, and I've been told there are no longer apartments available. Friends who live there tell me that there are plenty of studios available. What is my recourse, and can I prove that the complex is purposefully holding back apartments?
THE SOLUTION
If you suspect a Mitchell-Lama building is purposefully keeping apartments off the market in hopes of selling (or renting them out) at a higher price once the place goes market-rate, you should first confront them, and if that doesn't work, report them, says Steve Wagner, a real estate attorney with Wagner Berkow.
"To go about things properly, first get in touch with both the co-op board and the managing agent," says Wagner, "saying that you're aware of the available apartments, and requesting the opportunity to purchase." If the powers that be respond that there aren't any open apartments—or if they don't respond at all—it's time to go over their heads and tattle.
Where you do your tattling will depend on whether this building is a city-run or state-run Mitchell-Lama. (City-run buildings are supervised by HPD, and state-run buildings by the DHCR.) Any paperwork you have regarding your spot on the waitlist should mention which government entity your building reports to; failing that, both the city and the state keep running lists of their respective Mitchell-Lama developments, so you can easily see which list your building lands on. (A roster of HPD-run Mitchell-Lamas can be found here, and DHCR-run buildings here.)
Once you figure out where to send your complaint, Wagner advises, explain your situation: that you've been on the waiting list for several years, are a qualified buyer, and have been told there are no apartments available when building residents tell you otherwise. "Say, 'The following apartments are now vacant in the category I'm looking for, can you investigate, and require the housing complex to offer me one of the vacant units." While government agencies do take an active interest in making sure Mitchell-Lamas follow the rules, Wagner notes, in order to increase the likelihood that you'll ever hear back about this, you should specifically request a response. (This will also help you feel like your complaint hasn't just evaporated into the bureaucratic ether.) "Add that you would appreciate a response to your letter as a result of the investigation, and request that HPD or the DHCR contact you immediately if there's any respond they cannot respond or are otherwise unable to help."
If the city or state does, indeed, find that the building has been holding back perfectly good apartments, they'll likely compel the building's managing agent or board to put them on the market ASAP. This is good news for you if you're at the top of the waiting list, as these buildings are legally required to follow the chronological order of their waiting lists when it comes time to sell the apartments.
Related:
How do I kick my deadbeat brother out of the co-op I co-own with our dad?
Hit the NYC jackpot: how to get an affordable Mitchell-Lama apartment
What happens when affordable Mitchell-Lama buildings go market rate?
