Condos Versus Coops Versus Townhouses
Steven Kalachman LLC
- Ownership of real property with a deed.
- Ability to sublet/rent usually not limited (although minimum lease term often one year).
- No board approval required for subletting/renting or sale.
- Generally significantly more expensive than coops (approximately 65% higher than coop prices in 2016).
- Typically no mortgage on building.
- Most new developments are condos.
- Foreign buyers typically prefer condos rather than coops which can impact and boost pricing.
- Board has no control over “quality” of tenants and purchasers.
- Mortgage tax = 2.05-2.175% of mortgage amount.
- Prices usually significantly lower than condo prices (approximately 61% of condo prices in 2016).
- Comprehensive board application required for purchasers, including but not limited to: copies of W2s and tax returns, bank account statements, investment account statements, credit card statements, personal financial statement, employment letter, credit check, background search, landlord reference letter, personal and professional reference letters.
- Coop Board has some control over “quality” of tenants and purchasers.
- No mortgage tax on purchases.
- Significantly more coops than condos.
- Most prewar buildings are coops.
- Ownership of shares of a company that owns building – not a direct ownership in real property.
- Coop Board usually must approve purchasers and tenants.
- Ability to sublet usually limited.
- Financial qualification requirements by Coop Board generally much more stringent than that required by bank for mortgage approval.
- Buildings typically have a mortgage.
- Owner is responsible for maintaining entire structure.
- A full inspection with written report prior to signing contract is strongly recommended.
- Owner responsible for managing property although for multi unit townhouses a property manager can be hired.
- Most townhouses will include outdoor space, typically a garden and/or roof deck.
- Since there is no board it can be easier and faster to complete renovations.
- Square footage reported on a gross basis instead of net basis for condos. In many areas of Manhattan single family townhouses are the highest priced residential property on a per square foot basis.
- Mortgage tax on purchase will vary based on factors including price and number of units, typically will range from 2.175% - 2.8% of mortgage amount
- Relatively very few townhouses, typically representing less than 3% of total sales volume.
Steven Kalachman LLC