The Housing Department Fund Corporation (HDFC) is New York City’s answer to low-cost housing. It affords the right buyer (someone with good credit and a solid financial future) with an apartment below market value in a wonderful location/building. It’s definitely something to consider.
Unlike with a typical co-op, you may need to make less — rather than more — money to qualify for one of these units. For example, if you’re a family of four and your declared annual household income is greater than $150,000, you will likely not qualify for most HDFC units currently on the market. Ironically, this means that a family struggling to qualify to rent an average-priced two-bedroom apartment under the 40-times-the-monthly-rent rule makes too much money to qualify for most HDFC units.
HDFC co-ops require at least 20% down. This means that first-time-buyer mortgages, which frequently require only 3–5% down, are out of the question. But cash-strapped HDFC co-ops often require much higher down payments and even seek cash-only deals. In other words, in order to buy into an HDFC building, you will need to be income poor but asset rich.
And, if you sell the apartment, you have to give the cooperative up to 30% of the profits, so if you go in, it’s to live there a long time and raise your family; it’s not for a quick flip. BUT, for the right person at the perfect time, it’s something to think about. If you have questions, give me a shout-out.