New York City is like a box of chocolates–you never know what you're going to get. Nothing illustrates that more than your living arrangement. With five boroughs and hundreds of apartment styles, your whole life is dictated by what your bathroom looks like and who your neighbors are. However, if you are in the position to buy your own place, here's what you should know.
If you are purchasing your home within the City, it is more than likely a Co-Op or Condo. How do you tell the difference? And why does it even matter? Well, you get something different with both.
A Co-Op building is owned by a corporation. In order to have your own space, you must own a share (or shares) of the building. However, this means the apartment is not really yours.
Benefits of a Co-Op:
-Co-Ops are cheaper than Condos and their maintenance fees are tax-deductible
-A portion of your maintenance fees go to property taxes, since the entire building receives a bill rather than the individual tenants
-Very secure investment
-All incoming purchasers are scrutinized for the benefit of the building tenants' health and safety
Drawbacks of a Co-Op:
-You have been approved by the building's board in order to purchase a share, which can be stringent and timely.
-Can be turned for any reason without explanation
-Large down payment required
While Co-Ops are just shares in a building, a Condo is your very own place! You'll physically receive a deed to the space.
Benefits of a Condo:
-Maintenance fees are cheaper than a Co-Op's
-Financing a condo is much easier than it would be a Co-Op's
-Generally allowed to sublet your space
-Are not able to reject a buyer for just any reason
Drawbacks of a Condo:
-Real estate tax must be paid separately
-If there are issues with the space, the costs must be shouldered on the tenant rather than the building
-Can be difficult to sell because of their lack of variety
Which one is right for you?
The best way to make this decision is by thinking about what you intend your future to look like over the next couple of years. Are you looking to make a permanent home in this place, or do you think you'll just be passing through? If it's the first one,then your best bet may just be a co-op. However, if you want the flexibility that comes with buying and selling a condo, then it may be easier for you to simply own your home. Style, budget, and location also play a significant part in finding what's best for you. For advice on making the decision on what kind of home fits you best, schedule a consultation with Irena Mykyta today.
Irena Mykyta is a New York lawyer. This blog is not legal advice and should not be acted upon without obtaining legal counsel. To request further information, contact Irena for a free 30 minutes consultation at [email protected]