An idea primarily based in Manhattan, COOPS make up about 85% of all available properties for sale in New York and 100% of prewar buildings. COOPs are owned by an apartment corporation, hence the term "COOP." When purchasing in a COOP building, you are purchasing shares of the corporation which entitles you as a shareholder to a "proprietary lease" and use of the space. The amount of shares is determined on the size of your apartment in proportion to the building. Shareholders contribute a monthly "maintenance" fee to cover shared building expenses such as staff, insurance, hot water and real estate taxes. Portions of the maintenance fees are tax deductible.
Renting or reselling in a COOP can be difficult. Each COOP operates differently and should be carefully considered before purchasing an apartment. This can in turn affect your resale and appreciation of the apartment.
The COOP board can request a personal interview of the prospective purchaser during the application process. A board package must be prepared prior to meeting with the board. The package includes information that outlines your financial worthiness and your character reference.
A condominium on the other hand is a fairly new concept in New York that has quickly gained in popularity. A condominium apartment is considered "real" property. A buyer receives a deed of ownership. Condominium owners receive a seperate tax bill and the monthly common charges cover the shared costs of building maintenance similar to COOPs. Their maintenance tends to be lower than COOPs as there is no underlying mortgage for the building.
The simple process of purchase, sale and renting in a condominium make it an attractive alternative to buyers both locally and internationally. You can also finance up to 90% of the purchase price as opposed to COOPs which require 20% and above.