Choosing Between New Condos Vs. Co-ops

If you're in the market for housing, but know that you do not want to own a home, your options are a condo or a co-op (assuming that you do not want to rent). You can find luxury condos and co-ops all across the country and both are great alternatives to owning a home. However, there are a vast amount of differences between the two that you should be aware of before making a decision.

A co-op, short for cooperatives, is an apartment building owned by a corporation and you will technically not own it the same way you would with a single-family home or condo. Instead, you own shares of stock in the corporation. The number of shares is determined by the size of the apartment. A big difference for co-ops is that there is a Board of Directors elected. They are responsible for approving prospective tenants, which can be either good or bad. Co-ops tend to have a much more stable community because of this. Residents will stay for longer periods of time and there is almost a sense of exclusivity since everyone must be approved.

The board must also approve most renovations and when you wish to sell your apartment, the board must of course approve the new owner. Co-ops tends to be less expensive than condos and closing costs will also be cheaper because it is not real property. Both co-ops and condos will require you to pay monthly maintenance fees to take care of the building. If you're looking to sub-let your apartment, this can be very difficult for a co-op. If the board does allow you to sub-let, they must approve it and they may only allow it for a certain amount of time. The board also discourages the use of the apartment for professional or business purposes.

Unlike a co-op, a condo, or condominium, is considered a piece of real estate that you own. You do not own the entire building, but rather, the entirety of the unit. All the people in the building have use of common areas though. One advantage to luxury condos is that many come with amenities, such as pools, club houses, bars, and gyms. Because you own the condo, you should be able to sub-let the apartment. You can also take advantage of tax breaks for home ownership.

Both co-ops and condos offer a good amount of pros and cons. There are a lot of factors to consider and you must think about the amount of control you want over your home. Having to constantly go through a Board of Directors might be very problematic for some. However, both are great choices for those who are tired of renting and want to know the feeling of ownership. Co-ops and condos are especially good for those who cannot afford single-family homes and for those looking to retire. They are also ideal for those looking for a vacation home because they are cheaper. So consider the advantages of living in a beautiful beachfront condo or a luxurious co-op overlooking the city.