What are the pros and cons of buying into an HDFC co-op?

Hi there:

Does anyone have any experience with HDFC coops, both positive and negative, that you could share? I’ve been looking into purchasing into a coop and was told it was HDFC. There were income restrictions that applied, and I wonder what this means in terms of resale value at a future time (the agent I spoke to seemed unwilling to directly address this question, which I took as a warning sign). I like the idea behind HDFC income restrictions, but at the same time it is still an investment (of sorts) and I’d like to know that what I’m putting into ownership of the space will eventually bear some fruit, however small. I’m also concerned that selling would be tough once I am ready to move on — which I don’t expect to happen for some time — because of the income cap. The building I’m looking at seems very financially solid, and that means a lot to me, and I’m keen on the unit, but I just want to have a little clarity on how this situation differs from a non-HDFC building and what I should look out for. 

Thank you for your input!

tracyj

in Real Estate - General 12 years and 10 months ago

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thatwasmyidea | 12 years and 10 months ago

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i personally think the income restrictions make resale tough unless you find someone who can meet the income restrictions but somehow has a lot of cash, i.e., a parent or lots of savings. Unless you are really in love with the apartment it might be better to avoid unless you have time to wait for the right buyer but most people will be turned off by the restrictions too.

A non HDFC building won’t have income restrictions generally, but could have flip taxes which would crimp your investment return. I personally would probably stay away from income restrictions unless the apt is just that good or if you just don’t care that much about making money when the time comes to sell.