When considering buying a housing cooperative, it may initially seem a lot like condominiums. However, housing co-ops and condos have notable differences that set them apart.
It is important to understand these differences, as they can contribute to the decisions a person should make when deciding which to purchase.
The Ascent discusses some differences between housing cooperatives and condominiums. First, each handles the screening of buyers differently. With condos, blocking people from buying due to protected characteristics like marital status or race could land an association in serious trouble. On the other hand, housing co-ops can exclude buyers more often, especially if they do not have good financial standing. Vetting and background checks often happen with housing co-ops.
Next, living unit ownership looks different. Condos are real property, but a co-op owner purchases a share of the building without becoming the owner of their living unit. More shares equate to more living space.
Finally, the rights to modify a living space change. Because housing co-ops have collective ownership, it is much harder for people to make individual changes to their units. It is possible to make modifications, but they must happen in accordance with the overall rules set up by the cooperative collective.
Thus, each option has certain benefits and drawbacks that might favor different types of property owners. This is why research is necessary before actually purchasing any unit or share in either property. This helps to ensure that it suits a person’s needs and overall lifestyle best.