[This week, real estate appraiser, Curbed graph guru, blogger, and podcaster Jonathan Miller considers that monthly check.]
Since we've been fixated on the higher rental costs facing New Yorkers as of late, I thought I'd look at the the ownership side of the housing market and, specifically, monthly HOA fees.
I wanted to present a visual on how these monthly fees trended over the past 3+ years. I looked at the average monthly cost per square foot based on all the sales I had for each period.
Formula: 1,000 sq ft apartment with $1,500 month fees would be $1.50 per month.
Co-ops: Based on monthly maintenance fees.
Condos: Based on the combination of common charges and real estate taxes. My weakness in this approach is the inclusion of the currently tax abated buildings which are usually substantially below non-tax abated buildings. At some point I'll need to parse abated and non-abated for condos but for now, this is what I have.
(With and without inflation) Observations:
Condos have faster-rising HOA costs: Before considering inflation, co-ops were up 11 percent and condos were up 16.3 percent. It makes sense that condos would have risen faster since the abatements were phasing out and therefore average taxes per square foot would rise.
Inflation-adjusted results show stability: After adjusting for inflation, which is more realistic, co-ops actually slipped 4 percent and condos were up 0.6 percent.
In other words, after adjusting for inflation, it appears that monthly HOA fees on a market wide basis are fairly flat despite rising fuel costs and other operating costs. Now these results are based on what SOLD, not all housing units. The results do seem detached from conventional wisdom, but hey, this is Curbed and these are the numbers.
· Matrix [matrix.millersamuel.com]
· Three Cents Worth archive [Curbed]