Buyer's guide
The different forms of property ownership in NYC
Cooperative
In Manhattan, cooperatives amount for two thirds of all apartments available for purchase. Co-op buildings are owned by a corporation. When you purchase an apartment in a co-op , you are actually buying shares of the corporation that entitle you as a shareholder to a "proprietary lease."
Condominium
Unlike a co-op, a condominium apartment is real property, and a purchaser is given a deed. In addition to owning the apartment, you also own a small percentage of the common elements of the building like the halls, stairwells, etc.
Cond-Op
A cond-op is a residential cooperative where the ground floor (typically commercial units) is converted into a separate condominium that's either owned by an outside investor or the original building sponsor. So while the residential units are a co-op, the commercial units are owned as a condominium by an entity other than the co-op. The co-op does not receive the benefit of the income from these units.
Townhouse
Owning a townhouse provides the owner with a "fee simple" ownership of real property. The sale of the property may be conveyed to any party without prior approval by anyone other than the owner.
Cooperative
In Manhattan, cooperatives amount for two thirds of all apartments available for purchase. Co-op buildings are owned by a corporation. When you purchase an apartment in a co-op , you are actually buying shares of the corporation that entitle you as a shareholder to a "proprietary lease."
- Co-op shareholders also pay a monthly maintenance fee to cover building expenses like heat, hot water, insurance, staff salaries, real estate taxes and the mortgage debt of the building. Portions of the fee are tax deductible; and shareholders can deduct their portion of the building's real estate taxes.
- Approval to purchase shares of a co-op must be granted by a board of directors, who also have the authority to determine how much of the purchase price may be financed and minimum cash requirements. All prospective purchasers must submit a "board package" containing a purchase application, personal and professional letters of recommendation plus detailed information on income and assets. The board will also require an interview so they can meet you and ask any questions regarding the information you provided. They can approve or deny any applicant as they choose.
Condominium
Unlike a co-op, a condominium apartment is real property, and a purchaser is given a deed. In addition to owning the apartment, you also own a small percentage of the common elements of the building like the halls, stairwells, etc.
- There is a monthly common charge which is paid to the condominium association to pay for such items as payroll, building maintenance and supplies, management fees, and building repairs. These charges do not include your real estate taxes and are not tax-deductible. They also tend to be lower than in co-ops because there is no underlying mortgage for a condominium building.
- Each individual apartment in a condominium receives a separate tax bill from the city.
Cond-Op
A cond-op is a residential cooperative where the ground floor (typically commercial units) is converted into a separate condominium that's either owned by an outside investor or the original building sponsor. So while the residential units are a co-op, the commercial units are owned as a condominium by an entity other than the co-op. The co-op does not receive the benefit of the income from these units.
Townhouse
Owning a townhouse provides the owner with a "fee simple" ownership of real property. The sale of the property may be conveyed to any party without prior approval by anyone other than the owner.
Prepare your Financing
Learning from a mortgage professional about what you can afford and financing options before you start looking for a property will save time and streamline the buying process. During this early phase of the financing process there are two levels of endorsement:
Pre-Qualification: Based on the information you provide during your initial conversation with a mortgage professional, you are potentially qualified for a stated loan amount, assuming full and accurate disclosure.
Pre-Approval: You will next provide your mortgage professional with information for a detailed background and financial check . You'll then get a letter from a lender stating the amount the lending institution would loan you. This commitment is usually valid for 60 days. Most sellers require buyers to provide a pre approval letter with an offer letter.
Timeline for the buying process
Once you decide to make an offer on a home, it can take an average of 60 - 120 days to complete the process.
Learning from a mortgage professional about what you can afford and financing options before you start looking for a property will save time and streamline the buying process. During this early phase of the financing process there are two levels of endorsement:
Pre-Qualification: Based on the information you provide during your initial conversation with a mortgage professional, you are potentially qualified for a stated loan amount, assuming full and accurate disclosure.
Pre-Approval: You will next provide your mortgage professional with information for a detailed background and financial check . You'll then get a letter from a lender stating the amount the lending institution would loan you. This commitment is usually valid for 60 days. Most sellers require buyers to provide a pre approval letter with an offer letter.
Timeline for the buying process
Once you decide to make an offer on a home, it can take an average of 60 - 120 days to complete the process.
- Negotiate the Offer & Acceptance: 2-5 days
- Loan Application & Appraisal, Loan Approval and Commitment Letter, Sign Contract/Escrow Deposit: 2-4 weeks
- Co-op Board Package & Interview/Condo Application: 4-6 weeks
- Bank & Attorney Prep Closing: 1-2 weeks
- Final Walk Through: as close as possible to closing
- Transaction Closing: 3 hours