Buying A Condominium or CO-OP
Buying a Condo or CO-OP? There are many significant factors to buying a condominium.
Owning this type of property differs in owning your own home in many ways. Many people find
owning a condo works for them because of the differences. Is a condo right for you? Below is a
list of qualities unique to a owning a condo or townhome.
Condominium
• Buyer owns the condominium unit space
• Pays Property Tax on Condo with added common areas
• Pays Monthly maintenance Fee
• Condominium Complex has Board, owner can vote on issues regarding the complex.
The condominium owner has absolute and unrestricted ownership and is individually responsible
for property taxes and maintenance fees. To determine the market value, use the sales price of
condominiums with similar size, appeal, age, neighborhood, and maintenance fees.
Cooperatives: Most co-ops are incorporated and a board of directors governs the complex with
the owner of each individual unit having one vote. The owner has no deed, only stock and a
proprietary lease that has a term from 10-50 years renewable automatically or at the discretion
of the shareholders. He/she cannot refinance his unit as a condo owner can. Mortgage, property
tax and maintenance fees are paid pro rata by the owner according to the percentage of the
overall size of the unit. Property tax appeals involve the corporation and the stockholders.
Areas to look into:
*Check out the by-laws, proposed by-laws, fees for maintenance of outside areas. See if you are
allowed to make improvements in the condo's Declaration of Condominium document. See if the
by-laws are to your liking.
*Look into the financial health of the condo by checking financial information listed under
"reserve fund" to see if it is set up to cover for emergencies. Obtain a copy of the condo's
current budget and study their financial statement so there will be no surprises.
*Get an Estoppel Certificate that will show if the current owner owes fees or if any liens against
the condo exist. Owners can be evicted for nonpayment of fees. Obtain a Certificate of Insurance
showing how much the condo board has purchased to cover damages to the common areas.
*Get a statement of the percentage of occupancy of the condominium complex. This may alert
you to potential problems if the occupancy rate is low.
*Obtain a statement that spells out the use of recreational facilities as well as a drawing or photo
of the unit's interior and recreational facilities. Get a list of improvements, if any, the developer
agrees to make.
*Get a statement that spells out the monthly or yearly maintenance fees you are expected to pay.
Buying a Condo or CO-OP? There are many significant factors to buying a condominium.
Owning this type of property differs in owning your own home in many ways. Many people find
owning a condo works for them because of the differences. Is a condo right for you? Below is a
list of qualities unique to a owning a condo or townhome.
Condominium
• Buyer owns the condominium unit space
• Pays Property Tax on Condo with added common areas
• Pays Monthly maintenance Fee
• Condominium Complex has Board, owner can vote on issues regarding the complex.
The condominium owner has absolute and unrestricted ownership and is individually responsible
for property taxes and maintenance fees. To determine the market value, use the sales price of
condominiums with similar size, appeal, age, neighborhood, and maintenance fees.
Cooperatives: Most co-ops are incorporated and a board of directors governs the complex with
the owner of each individual unit having one vote. The owner has no deed, only stock and a
proprietary lease that has a term from 10-50 years renewable automatically or at the discretion
of the shareholders. He/she cannot refinance his unit as a condo owner can. Mortgage, property
tax and maintenance fees are paid pro rata by the owner according to the percentage of the
overall size of the unit. Property tax appeals involve the corporation and the stockholders.
Areas to look into:
*Check out the by-laws, proposed by-laws, fees for maintenance of outside areas. See if you are
allowed to make improvements in the condo's Declaration of Condominium document. See if the
by-laws are to your liking.
*Look into the financial health of the condo by checking financial information listed under
"reserve fund" to see if it is set up to cover for emergencies. Obtain a copy of the condo's
current budget and study their financial statement so there will be no surprises.
*Get an Estoppel Certificate that will show if the current owner owes fees or if any liens against
the condo exist. Owners can be evicted for nonpayment of fees. Obtain a Certificate of Insurance
showing how much the condo board has purchased to cover damages to the common areas.
*Get a statement of the percentage of occupancy of the condominium complex. This may alert
you to potential problems if the occupancy rate is low.
*Obtain a statement that spells out the use of recreational facilities as well as a drawing or photo
of the unit's interior and recreational facilities. Get a list of improvements, if any, the developer
agrees to make.
*Get a statement that spells out the monthly or yearly maintenance fees you are expected to pay.