{"id":557,"date":"2018-05-22T10:51:44","date_gmt":"2018-05-22T15:51:44","guid":{"rendered":"http:\/\/www.realtyhop.com\/blog\/?p=557"},"modified":"2023-01-31T11:13:14","modified_gmt":"2023-01-31T16:13:14","slug":"what-are-the-benefits-of-buying-in-a-coop-vs-a-condo","status":"publish","type":"post","link":"https:\/\/www.realtyhop.com\/blog\/what-are-the-benefits-of-buying-in-a-coop-vs-a-condo\/","title":{"rendered":"What are the Benefits of Buying a Co-op vs a Condo?"},"content":{"rendered":"
Prospective homebuyers have many decisions to make when acquiring a property. They will have to set a budget, determine their must-have features and amenities, and also go through the process of securing financing. Buyers may also decide whether to purchase a condo or co-op unit. Both units offer different purchasing options and requirements. <\/p>\n
Condominium and cooperative units are residential spaces in larger buildings. Condos and co-ops look similar and may even have identical features. It would be difficult to differentiate them based on a tour of the apartment. However, these types of units differ in several ways, mainly through their ownership structure. <\/p>\n
Buyers who purchase a condo unit become private owners of the residence. Condo owners also own a percentage of common areas on the premise. Co-op buyers become shareholders of a corporation that owns the entire building; they receive a proprietary lease for a unit in the building and the ability to use common areas in the building.<\/p>\n
<\/p>\n
Photo Contribution: RealtyHop Staff<\/em><\/p>\n Condo units typically have a higher asking price than co-op units. Buyers will also usually purchase title insurance<\/a> and a mortgage recording tax. However, co-ops usually have higher monthly maintenance fees than condos. Despite their seemingly equal price, co-op owners typically pay less per month than condo owners. <\/p>\n Co-ops typically require a higher down payment than condos. While prospective buyers may secure a condo purchase with a 10-15% down payment, most co-op boards require a 20% down payment. Though this upfront cost can increase the barrier to homeownership<\/a> for potential buyers, it helps decrease their monthly mortgage payments and ultimately decrease the amount of interest they end up paying on a conventional mortgage. <\/p>\n Co-op shareholders typically have lower property taxes than condo owners, as they split the cost of their property taxes among all board members. Condo owners pay their taxes individually. However, condo owners can deduct their mortgage interest<\/a> and property tax payments, potentially saving them money. <\/p>\n Learn more:<\/b> Understanding New York\u2019s STAR Tax Credit<\/a><\/em><\/p>\n Co-ops come with higher monthly maintenance and homeownership association (HOA<\/a>) fees than condos. Some cooperative owners will even pay their utilities<\/a> as part of their monthly maintenance fees. <\/p>\n When comparing two units on the same block in Chelsea, buyers can see the different price structure breakdown between co-ops and condos. Take the following two units as an example, which both have an asking price of $675,000: <\/p>\nCost of a Co-op vs. a Condo <\/h2>\n
Down Payment<\/h3>\n
Property Taxes<\/h3>\n
Maintenance Fees<\/h3>\n
Price Comparison <\/h3>\n