Real Estate Q&A: Condo vs. Co-op?
What’s the difference between a condo and a co-op?
The quick way to understand the difference between a condominium and a cooperative apartment is to look down at your feet. If you’re in a condo, you own the space directly under them; if you’re in a co-op, you own shares in an association that owns where you're standing. The only thing you really need to know is that either way, the space within the walls of the apartment belongs to you -- there's just a legal designation making the type of ownership different. This difference will be most important when you're applying for a mortgage and going through the process of buying your apartment.
Co-ops are most prevalent in New York City, where they make up almost 85 percent of available apartments for sale. In a co-op, the affairs of the building are controlled by a board of managers usually made up of fellow owners, and this board must approve all sales and all expenditures of the monthly maintenance fees. Typically, co-ops are less expensive and have lower maintenance fees than condos, but they require you to put more money down (say, 30 to 50 percent as opposed to the condo fee of 10 to 20 percent). Co-ops usually come with more rules about subletting, pets, and home renovations. Condos are also controlled by boards of managers made up of fellow owners who approve sales, when necessary, and control the spending of the maintenance fees. But owners of condos own the deeds to their apartments and have separate tax bills for each unit.