Home Buying in 32967>Question Details

Cindy, Home Buyer in Rogersville, TN

what does co-op mean when looking to buy a condo?

Asked by Cindy, Rogersville, TN Thu May 10, 2012

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The traditional housing co-op involves the formation of a corporation for the purpose of acquiring title to a multi-unit building and, in turn, leasing individual units (apartments) to the shareholders of the corporation; whereas condominium ownership involves acquiring title to individual apartments or units. In fact, condominium ownership is, for most practical purposes, only one form of cooperative housing and, like the co-op, must include provisions for management and maintenance of the building(s) and common areas, usually dictated by an elected Board of Managers, in the case of a condominium, and a Board of Directors in the case of a co-op. The condo advantage of individual unit ownership can be compared to the benefit of being able to choose your neighbors in a co-op setting, where the application process is very often quite selective. In the sale of a condo, once a price is agreed upon, the deal is done; whereas the sale of a co-op requires approval by the Board of Directors—which can be (and often is) withheld based upon arbitrary selection criteria—with no recourse to the buyer or seller if the sale is not approved. Co-op ownership represents an interest (i.e. stock) in realty; condo ownership is actual ownership of realty. Price differences reflect demographic and geographic distinctions. You decide what’s best for you.
1 vote Thank Flag Link Sat May 12, 2012
Let's say I am interested in purchasing a co-op condo, am I able to make any changes, such as upgrades or do I need approval from a Board of Managers?
Flag Fri Jul 19, 2013
Co-op means you are buying "air space". There is one deed for the property. Good news is that these are priced lower than conventional "fee simple" condo's.
0 votes Thank Flag Link Mon May 21, 2012
You are simply buying "air space" in the property. The good news is those properties are usually priced below fee simple properties. Downside is less buyers will to buy air space and less lenders willing to lend on them.
0 votes Thank Flag Link Sat May 12, 2012
You are buying a share of the entire building, rather than a deeded piece of property.
0 votes Thank Flag Link Thu May 10, 2012
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