Buying a NYC Co Op

Buying a co-op apartment is similar to buying an apartment or a condominium in New York City. In a cooperative housing project, the individual housing units are owned by a cooperative housing corporation. The key difference between a condominium apartment and a co-op is that condo owners own their own units individually. When you purchase a coop, you are buying shares or a membership in a co-operative housing corporation. This corporation is usually a not-for-profit corporation democratically set up to own real estate. CoOps have monthly association dues that have to be paid. These dues go towards things like trash removal, snow removal, and general common area upkeep.

New York City Co-Op Property Types

A coop can be any sort of property: apts, high rise, condo, townhome, brownstone, single family home, etc... These can be ultra luxury high end units, affordable housing units, or anything in between. Just because housing is cooperative does not determine the style of living in the coop.

Housing Cooperative Types

There are 3 major types of housing coops available in New York which will determine how equity is built in your coop.

• Market-Rate Coop - In a market rate cooperative, coop units sell at a natural market value. This means that they are priced to sell at the highest price the market will allow, allowing you to build equity in your coop at a similar rate to condos or other traditional real estate.
• Limited-Equity Coop - In a limited equity cooperative, or LEC, coop units sell at a price that is restricted by the coop bylaws. This is usually done for the benifit of the coop as a whole for tax, mortgage, and other monetary reasons. This usually creates an affordable housing situation, and many LECs have income restrictions for owners. This keeps coop units priced affordably for people who need affordable housing.
• Leasing Coop - Zero Equity - In a Leasing cooperative the co-op corp leases real estate from someone else, usuaally another not for profit corp set up for this purpose. In a leasing co-op, the coop never owns any real estate and never build any equity. In this situation, the cooperative owner never builds any equity in their coop unit, it's as though they were leasing or renting the coop.