"How is a real-estate co-op different from a condo?" a client recently asked me, so I thought I would write a blog post about it.
What is a Real Estate Co-op?
A real estate co-op is an apartment building with multiple units where each person who lives there has an interest in the entire building, and a contract, or share of the stock, that enables the owner to reside in a particular apartment unit there.
If you own a condominium, your apartment and a percentage of the common areas (called the “common elements”) belong to you. A real estate co-op owner is often called a shareholder, and it’s important to note that they do not own the actual unit. In fact, this is more similar to a person being a tenant.
Another important distinction between a condominium and a real estate co-op is that most co-op associations make it a requirement for a prospective purchaser to be approved by a membership committee. The membership committee is made up of current co-op owners.
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