Owning a home is something that makes you feel proud. It is a dream that not everyone can fulfill. According to the census data, around 51 percentage of the house occupants in New York are renters.
If you are planning to buy a property, it is important for you to first obtain knowledge about different types of property ownership. Angus Reed gave us some insight to what these are (Learn more about Angus Reed). Below are the four types of properties you will see in the real estate market.
Cooperative:
These are the oldest form of property ownership available in the US and still comprises of nearly two-thirds of the total apartments available for purchase. These properties are owned by apartment corporations and when you buy a unit, you actually buy the shares of the corporation.
Approval for making the purchase of a co-op is granted by a committee called the board of directors. They also have the authority to determine the minimum cash requirements and the finance amount. While most co-ops need a minimum down payment of 20 percent, this could be even higher for some. There are co-ops that don’t even allow purchases with loans. For a foreign buyer, getting a co-op can be really difficult. They need to have the necessary paper trail with U.S. banks, U.S. credit or both.
The board of directors has the power to approve or deny the applicant’s request for purchase. So, it can be difficult to sell your unit even when both the parties are ready.
A monthly maintenance has to be paid by dwellers to the cooperation for expenses like maintenance and staff salaries. One big advantage of co-op is that they are less expensive than condos of the same size in the same locality.
Condominium:
Unlike co-ops, in condominium, the purchaser gets a deed rather than a lease. In addition to the ownership of the apartment, the buyer also gets a percentage in common areas of the building like the halls, stairways and the basement. Like co-ops, there are monthly charges to cover operational and maintenance charges of the building and its facilities. Taxes in condos are billed separately for each unit.
Since the ownership of a condo belongs to one person and not the board, the decisions like the down payment amount and whom to lease can be taken by the person solely. This makes them a good option as an investment property.
Because the property is seen as a good investment option, the price of a condo is generally high. Also, if you want to buy a condo, you will get limited options since its availability in the Manhattan is very limited.
Condops:
These are a co-op which is formed by the dwellers of condo units. The co-op has to abide by the condo rules but the residents follow co-op rules too. Because of formation of co-op, there is a board of directors and approval processes, just the way they have in other co-ops. Condop owners divide the apartments into shares which are distributed among the residents. Since they are condos, they have large residential space.
There are pros and cons of each type of residential units discussed above. You must decide what kind of property you want to purchase according to your requirements. Your decision must be based upon the use of the property and whether you want to purchase it for living or subletting. Even if you want to buy it for your personal use, you must decide for how long would you stay in this apartment. Investment in property is a huge investment, you must think every aspect of it thoroughly.