What's good about owning a Condo or a Co-op?
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There may be more security with neighbors close by
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The exterior of the building, landscaping, driveways and common areas are owned by the association which handles and pays for all exterior repairs and maintenance
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The entry, interior hallways and all common areas are maintained
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Some condos/co-ops include pools, weight rooms and recreational areas
Condo Ownership
Condo ownership is fee simple ownership, the highest form of ownership, and is the same type of ownership as for a single-family home. It is ownership of real property rather than personal property like your car. The major distinction in owning a condo is that it's communal living and so subject to community rules and the shared enjoyment and maintenance of the common areas. The ownership entity is known as the condominium and it is only as strong as its weakest member. The condominium operates a budget funded by a monthly fee paid by each of the condo owners. A portion of the fee goes into the association's reserve funds while the rest goes towards property management, and maintenance and repair of the common areas. This fee can be set as a flat fee with all owners paying an equal amount, or it can be set as a pro rata portion based on the number of bedrooms or the total livable square feet in each unit. Condo owners pay property taxes based on the assessed value of their unit.
Buying a condo makes sense if the buyer intends to own the property for at least 5 years, and wants the ability to rent at some time in the future. Although the ability to rent is highly probable, condominiums usually set maximum investor ratios in order to maintain property values and owners may have to wait until the number of rented units allows it. Traditionally, condo owners are first-time home buyers who transition from renting to property ownership and home-owners looking to down-size while enjoying most of the benefits of fee simple ownership.
 
Co-op Ownership: What is a cooperative, or co-op? A housing cooperative is a form of ownership in which a person purchases shares (or membership) in a cooperative corporation that was formed for the purpose of providing its members with a place to live. The unit is owned by a corporation. Prospective owners buy shares in the corporation and the corporation gives a proprietary lease to live in the unit as long as the shares are owned. The cooperative corporation owns the building, land, apartments and all common elements. The owners/ members, in turn, own the corporation.
Here are some of the differences between owning a co-op and owning a condo. Because a cooperative is considered personal property rather than real estate, there is no deed although owners also pay the equivalent of a transfer or recordation tax. Because co-op owners do not take title, title insurance isn't necessary. The cooperative itself usually has an underlying mortgage that's used for major improvements or acquisition. Each individual co-op unit bears a pro rata portion of the underlying mortgage, usually paying it down through a portion of the monthly fee. When an owner sells, the balance of the unit's underlying mortgage transfers to the new owner. If the payment will be included in the monthly fee, the balance of the underlying mortgage is subtracted from the sales price to determine the net amount that the buyer will finance.
Another major difference between a co-op and condo are the restrictions on use and occupancy placed in the proprietary lease of a co-op unit. The proprietary lease may restrict the amount of financing one can obtain using the shares as collateral, it may restrict a shareholder from subletting their space, or from having a specified number of occupants, or from having pets, or whatever else the co-op board deems to be appropriate. Prospective owners generally need approval by the co-op board before the purchase can be finalized. The approval process typically involves verifying credit worthiness, and income & asset information.
Cooperative financing is different from financing a condominium. Financing choices are abundant in Washington provided the co-op board has signed a recognition agreement with the prospective lender. The recognition agreement defines the relationship between the lender and the borrower, and establishes the priority of claims in the event an individual borrower is in arrears on either the monthly maintenance fee or the monthly mortgage payment.
Co-op ownership is collective ownership stressing respect and shared responsibility for the entire cooperative rather than just towards an individually owned unit. Co-ops can offer great value and substantial savings in property taxes since co-ops are taxed at a lower percentage of the appraised balue. This type of ownership makes sense if the buyer intends to own for 5 for more years, has little or limited need to rent, and agrees with the overall objectives of the cooperative.
For both condo and co-op owners, participation as a member of the board can be beneficial and is always appreciated.
* in the District of Columbia, effective 10/1/09, all residential property sales are subject to the following:
Properties selling under $400,00 ($1-$399,999):
1.1% of the final sales price charged each to the Seller and to the Buyer to transfer and record the deed or shares of stock.
Properties selling for $400,000 and above:
1.45% of the final sales price charged each to the Seller and to the Buyer to transfer and record the deed or shares of stock .
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