Is this a lawsuit I can bring against the agent?

Question

I purchased a NYC (cooperative) apartment that was listed as a 2 bedroom (and appraised as a 2 bedroom- like my place, the comps were 2 bedrooms, one large and one small). This was my first primary home purchase, and I bought it before I became a real estate investor, so I was clueless. I am trying to sell the apartment now, 6 years later, and I have discovered that my 2nd bedroom may NOT be a legal 2nd bedroom. It appears that the comps used for the appraisal all had second bedrooms that were legal (greater than 7-8 feet in width, depending upon whose definition you use), whereas mine has a width of 6 feet 10 inches.

The second bedroom was created by adding a wall between the kitchen and dining space by the previous owner. So when HE bought it, it was 1 bedroom, but the kitchen was very large.

(The appraisal is of course not a legal document and there is the disclaimer stating this.)

It seems that the seller's agent AND my buyer's agent have knowingly misrepresented the property. (Or, it's not real property, it's shares in a cooperative, but I think the same rules apply...?) They both stood to financially benefit from higher commission, because a "den" vs a "bedroom" would change the value significantly. This means I put a higher down payment, had higher closing costs, and there is a higher mortgage payment monthly for the life of the loan. It also means I would sell for a lot less than I purchased it.

The sellers agent had no fiduciary responsibility to me, but my buyer's agent did. He can't, as a licensed real estate professional, say he did not know the definition of a legal bedroom. He should have told me this and helped me negotiate a lower price, no?

Is this a legit lawsuit I could bring against him? Seems that any kind of statute of limitations would be a sort of delayed discovery thing (in other words, I couldn't have known until this very moment) but I'm not sure.

Yeah, I know- why didn't I look this up? It's because I walked through the apartment, asked him "Is this a legal bedroom? Because there is no closet." and he said "Yes, you don't need one in NY as long as there is a window." That is true, but turns out misleading. A full sized bed does fit and there was one in there at the time of purchase.

Bonnie Low · Answer

If i understand correctly, you want to be able to list it as a 2 bedroom to sell, but are now being told it doesn't meet the square footage requirement to be considered a 2 bedroom (albeit the "requirement" itself seems to be in dispute). You also mentioned that the second "bedroom" was created when a previous owner put up a wall to partition off what was previously part of a large kitchen/dining room to make the bedroom. If all else fails and you really want it to be considered a 2 bedroom by all bad enough to consider legal action, have you instead considered just hiring a contractor to move the wall again but this time to a dimension that would satisfy the sq. footage requirement for a bedroom? I don't know if space allows, but it might be easier and ultimately cheaper than legal action. Just a thought.

Patricia Berman · Answer

I'm not an attorney so I cannot speak about the validity of if you can bring a case.  What I'm here to tell you is that unless there is a ton of money on the line then it might not be worth the time, effort, energy, blood, sweat, and tears that it is going to take to bring the case, not to mention the fact the legal matters never really end up in the way that you want them to and you might not get the resolution that you desire.

I understand your frustration and desire for justice.  It is only right that you feel that way and those feelings are valid. But again, it is a soul sucking endeavor to take up this action and might not be worth all the money you will spend in legal fees.

Your energy might be better spent searching for new deals, educating on investing, and analyzing deals.  Legal action is draining and soul sucking.  Maybe doing something that is more regenerative might be the better investment of time.

Whatever you decide to do, I wish you luck!

Russell Brazil · Answer

In fact, the Real Estate Board of New York itself seems to provide conflicting information on this. It states the room has to be 8 feet wide...but also states it needs to be 6 wide at its narrowest width in the very next line

https://www.rebny.com/content/...

Russell Brazil · Answer

Most agents dont what actually makes a legal bedroom.

In fact, you dont either as youve stated 2 different possible dimensions that might be legal. " (greater than 7-8 feet in width, depending upon whose definition you use)"

In fact, it is very possible your living room may meet the requirements for being a bedroom, so it may in fact actually be a 2 bedroom.

John Clark · Answer

Check with an attorney, but you probably have a statute of limitations problem. You could have looked it up. You chose not to. See a lawyer.

Caleb Brown · Answer

I'd see an attorney. Honestly it'll be hard to prove they knew and lied to you. The appraiser agreed it was a 2nd bedroom too. I think it'll be hard to have a case with these circumstances.

Isaac S. · Answer

See a RE specializing lawyer, be ready to drop some money on it too.

Best of luck!

Jason Lee · Answer

Late to this thread but if it helps... I've sold many converted dining alcoves in co-ops and many agents I've run into have no clue what makes up a legal bedroom in NYC. Many are very seasoned agents and even seasoned sales managers and they don't know all the requirements. So yes, it's very possible your buyer's agent didn't know.

How much do you think you overpaid? In general, if you can fit a bed in it, if it has a window, and if you don't have to walk through it to get to another part of the apartment, then most people will use it as a bedroom, whether or not it fits the legal definition. If you can do that, then most people will pay a premium over a one bed that isn't converted or cannot be converted. You should have paid more than you would have for a 1 bed with a straight living room, and less than a true 2 bed. Any future buyers will do a similar calculus.

Is this a lawsuit I can bring against the agent?

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