Apartment Living / Rental
Q. What's the Difference Between and Condo and a Co-op?
Both condominium and co-op refer to types of ownership of apartment-like dwellings. While condos can be found in most developed areas, from urban to rural, co-ops tend to be more of an urban phenomenon. For the person seeking to purchase one, there are important differences to note.
In both condo and co-op situations, you are living in an apartment-like dwelling, usually attached to at least one other similar dwelling. There are shared common areas which can include lobbies, pools, parking areas, gardens, fitness rooms, and other facilities. Though you own rather than rent both a condo and a co-op, each will usually require some sort of monthly fee to cover shared expenses.
When you purchase a condominium, you are purchasing the actual unit you will live in. You own it (as some have said) "from the inside paint in". If they do not involve major structural changes, you are free to make most decorating and rennovation decisions without acquiring permission (though you should check your contract if you are considering serious rennovation).
Most condomium complexes have an association board made up of owners. This board oversees maintenance of common facilities and areas (like snow removal and lawn services) and maintenance of the buildings themselves (including exterior paint, damage repair and like issues). To pay for expenses involved in maintenance and repair, you will usually pay a monthly common fee or association fee.
The board will also act as mediator in disputes between owners, enforce complex regulations, and make decisions regarding special owner requests (like major rennovations).
If you want to rent or sell your condo, doing so is usually simply a matter of finding a qualified tenant or buyer. Tenants who rent condominiums are required to follow all rules and regulations for the community, and the owner is responsible for any violations.
The differences between a condo and a co-op is often apparent even before you buy your home: many co-op buildings require that all new owners/members be interviewed and approved by a board made up of current co-op members. When you purchase a co-op you are actually purchasing a share in a cooperative. While your share gives you the right to reside in your apartment, you do not actually own the apartment itself. You can usually decorate, including painting and wallpapering, as you can in a condominium, but rennovations usually need to be approved by the board.
As with a condo complex, a co-op building has a board made up of members of the cooperative. This board oversees maintenance and repairs as well as interviewing potential new members and enforcing rules and regulations. The board also manages the finances of the cooperative which owns the building and is responsible for maintenance, insurance, taxes and other expenses. A monthly fee, paid by each member of the co-op, pays the building expenses. This fee is usually higher than the monthly common fee for a similar condo.
If you want to rent or sell your co-op share, the board will usually have to interview and approve either a tenant or a new co-op member.
What's for You?
As with the own vs rent question, there is no one answer that is right for everyone at every time. If you are in the market to purchase a condo or co-op, you need to understand the differences between these two types of home ownership, read any contracts involved in purchasing and/or residing in the unit, and determine what is right for you at this point in your life.