December 2023 CT

HIGH INFLATION... from page 30.

2021, 6.5% in 2022, and currently annualized in 2023 at 3.75%. If there is a silver lining in the inflation data, the annualized rate for 2023 since May has been sub 4%. While the statistics are unavailable for New Jersey, Bloomberg News reported in October that New York City residents are paying increases in maintenance fees to their co-ops and condominiums at almost three times the inflation rate. As an owner you must ask your board or property manager what went wrong to know why this is the case. Were there not sufficient increases annually in the past to prepare for these increased costs? Preparing a budget takes hours upon hours of reviewing the numbers and doing adequate research. Among others, what are your local utilities pro jecting as an increase? What wage increases are needed to give those who maintain the properties, so that they don’t jump ship? Hiring and maintaining

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contribute?” With most owners leav ing the community in a few years, even the most ardent supporters of putting money in reserves in the early 2000s had to be thinking; “I will never see this money spent”. That argument is no longer valid. The saying save something for a rainy day can be traced to the mid-1500s, in an Italian play by A. F. Grazzini called La Spiritata. John Lyly adapted the play into English and renamed it The Bugbears: “Would he have me keep nothing against a rainy day?” Most people who buy in their communities today will not only buy an umbrella but will be around for several rainy days when they need to use it. According to the US inflation cal culator, the annualized inflation rate went from 1.45% in 2020 to 7% in

“Our community members are experiencing numerous changes with the current inflationary environment..."

quality staff is an expensive proposition. What is the industry trend on insurance increases? Reach out to those who help maintain your properties, like your pool or elevator technician, to ask them what parts you foresee having to replace in the next year. Thousands of dollars begin to add up. Here is an excellent start to question how condominiums or co-ops got into this situation. Before presenting a plan to address the concerns with increases in costs of operating and capital reserves, let’s look at the income side of the ledger. 214% is the increase in foreclosures in the State of New Jersey in the 1st half of 2022, according to ATTOM, a real estate data company. While the data suggests attributing most of these foreclosures to lifting the Covid restrictions, it is still astonishing. New Jersey leads the nation in foreclo sures. In Q3 2023, foreclosures are up 30.38% from Q2 2023 and year over year, a 42.67% increase from 2022 year to date. In recent history, according to Statista, 2021

Specialized lending and financial solutions for associations with Truist Association Services .

Learn more at Truist.com/AssociationServices. Tavarious Butts, VP / Relationship Manager 703-284-0561 | Tavarious.Butts@Truist.com

Truist Bank, Member FDIC and Equal Housing Lender . Loans and lines of credit are subject to credit approval. ©2021 Truist Financial Corporation. All rights reserved.

ABDM Property Management cares to listen to our clients. We exclusively serve Central and South New Jersey areas. • Customized property management plan to meet the demand of customers. • Accurate and timely financial reporting on monthly basis. • Vendor selection with no conflicts. • Certified managers who are committed to provide the highest quality of service in the industry. • Reliable and available at all times to Board members, and residents. Call 908-752-0374 or www.ABDMpropertymanagement.com

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