Co-ops & Condos
A form of housing ownership where residents buy shares in a corporation that owns the building, rather than owning their individual units.
In a cooperative, a corporation owns the entire building. Residents purchase shares of stock in the corporation, which entitle them to a proprietary lease for their specific unit. Co-op owners do not receive a deed; they receive a stock certificate and a lease. The co-op board has the right to approve or reject prospective buyers (subject to fair housing laws). Financing a co-op purchase requires a share loan, not a traditional mortgage, since there is no real property title to pledge. Co-ops are far more common in New York City than in most other markets.
Exam Tip
Co-op = shares and a proprietary lease. Condo = deed and fee simple. The co-op board can reject buyers, but not based on protected class. The exam tests these distinctions frequently.
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Co-ops & Condos
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NY Real Estate Co-ops and Condos
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