Home Buying in Brooklyn>Question Details

Denise, Home Buyer in Brooklyn, NY

Truthfully which is better to purchase a condo or co-op?

Asked by Denise, Brooklyn, NY Tue Mar 25, 2008

I get that with a condo one owns their unit, but still in Brooklyn isn't buying a co-op better that renting and still one is a buying into a group. With a condo, one owns their unit and is responsible for it, but that unit is in an apartment complex..so which is better to purchase?

Help the community by answering this question:

Answers

4
It seems to me that would be a matter of opinion; and my opinion would be whichever one re-sells faster and better! We do not have co-ops in our area, so I would say a condo, but in your area, it may be different. I would get with a local real estate professional - a Realtor - and have them help you analyze which would be better. I hope this helps!
Web Reference: http://www.SWOhioRealty.com
1 vote Thank Flag Link Tue Mar 25, 2008
I live in Brooklyn and work with buyers and sellers here - so here is the first-hand scoop. It depends on the neighborhood and type of place you are looking for. In the brownstone neighborhoods with protected historic districts, about 80% of apts. you can own are co-op. That is because in the 1980s many buildings, both townhouses and apt. houses went co-op. Condos are much more recent in NYC and in Brooklyn. So generally only newer developments of the last few years are condo. These tend to be new buildings with higher end finishes and amenities such as gym, playroom etc. They are on the periphery of the established neighborhoods. So what type of place you are looking for is a big factor. In any case purchasing is very wise compared to renting. You build equity and it is a fabulous investment. If you'd like to know the finer points of the differences between co-ops and condos, I'd be happy to explain in more detail.
0 votes Thank Flag Link Tue Aug 5, 2008
One thing was mentioned that you should strongly consider and that is to consult a Realtor always when you're considering buying real estate. That being said, buying a condo or a coop are similar in that you have "the legal right" to occupancy of either, but with a co-op you are buying into an underlying mortgage which, pro-rated for your unit, is probably still going to be more than monthly expenses incurred if you had your own mortgage on a condo, plus the usual other expenses, e.g c.c., real estate taxes, etc., adding to them.

There are pros and cons, and in the NY area there are many co-ops, more so than in other areas of the country.

A lot depends on how you qualify for any of the numbers to which you're subject to in either purchase, and its costs to purchase...so split a piece of paper in half putting costs to purchase one next to the other, and determine what portion is the tax write-off - condo vs. co-op - and add up all the monthly expenses and compare. If you haven't considered this, it's basic ...ask your Realtor and be sure he/she handles co-ops regularly. Ask questions to get answers you'll need; get copies of the financial statements on the communities of each, and have your attorney look them over...that's another expense, but a necessary one. I owned a co-op in NY State...and couldn't legally rent it out...that's an extremely important question to ask, and may change your mind if it cannot be rented. Who benefits when you sell the co-op - you or the Co-Op Board as it relates to market value? Do you or does the co-op Board? Some have sold back to the Board at the same price they purchased...no market value was in the picture at all. Therefore you have no chance for appreciation. Good luck with your due diligence - it will help you immensely for making a final decision.
0 votes Thank Flag Link Wed Jul 23, 2008
In general, in a place where land cost is very expensive, the builder build coop, so you see many prestigious location in Manhattan you can only buy coops. One reason, I guess, is because the original owner(s) or company wanted to have control of the future appreciation, also, the initial cost is lower. That is you may be able to build more.

Of course, if the land cost is so high, you see builder would rather build hotel.

Coop is kind of between apartment and condos, ownership wise, however, the "physical shapes" they are all similar except for the same grade of the 3, apartment tends to be smaller and condo bigger with coop in between due to the fact tenant often stay shorter than condo owner.

Owning a coop is like renting an apartment with OPEN END lease, not renew every year. If you need to renew every year, you will cry like my friend at Avelon Cove Jersey City NJ called me his rent jump $300 a month. Do you want to move out or renew? So, ownership is very important. There is many New Yorkers eventually fight with landlord because they made a wrong decision to stay at rental apartment for many years, 10 or 20 years!!! They should just buy a coop.

For condo, you got many of yours such as your a/c, furnance, hot water heater ...etc because physically you almost do not share these facilities, but you may still share parking lots, garbage, lawn maintenance, snow removal ...etc.

After knowing the nature of coop and condo, you also need to understand "purchase" involves money, and at rising market, coop seems to move up MORE than condo percent wise, on the other hand, coop will also move down more than condo, but there are exceptions as well.

Coop has the potential that it may be converted to condo at rising market, and when that happen, your coop value may be double overnight.

In the good old days, people also decided to buy coops if they do not have enough downpayment to buy condo which is usually twice the price of similar coop. Of course, if people has only security deposit, they would just have to rent an apartment. So the rule of thumb is that if you do not have or do not want to tie up your cash flow, you either rent or just buy a coop.

You may have seen many empty nesters sold their big house and downsize to a coop. Why not just rent? As mentioned above, when you rent, you are under a risk to have rent hike, but people retired with kids bought their own home, they still need a permanent place to called home, so coop seems to be a choice. For one reason coop over condo for the retired is that it is like living in a rental, not much to take care.
0 votes Thank Flag Link Tue Mar 25, 2008
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer