Most people know that a condominium is a unit in a multi-unit complex, and that people can purchase a condo much as they would a house. Some people think of it as “owning” an apartment. There are many of these complexes throughout the country. They are particularly popular in and near large metropolitan areas, like New York City. That is why they are popular here in the Jersey City/Hoboken area.
When you begin to investigate the possibility of living in a condo instead of a single-family residence, you may need to research some terminology. For instance, is the complex you are considering a condo or a co-op? In a condo, the owners receive the deed for their apartment. The owners are also responsible for the taxes on their units. They can rent it out to others if they desire to do so. However, condo owners usually pay monthly maintenance and grounds-keeping fees.
A co-op is a bit different. The owners, in the form of a non-profit company, own the whole complex. To be an owner, you buy shares of the company. Owners are often put through an approval process. They don’t actually own their individual unit. If they want to sublet their unit, the actual renter must go through the approval process also. In a co-op, the owners don’t get individual deeds or mortgages. The mortgage is paid by the non-profit company. The owners pay fees that include their share of this mortgage, as well as the fees on the upkeep of the property.
This, of course, is simply a thumbnail sketch of the differences between condos and co-ops. There are various other differences that require more in-depth investigation. Before you buy into either system, you should be completely familiar with all the agreements that are attendant to the process. If you want to buy into a co-op, for instance, you may want to check out what tax advantages there are for that system. If you are buying a condo, you should be sure that the owners association is solvent, and has enough money available to keep the place in good order, as well as an emergency fund for… well… emergencies.
How can I help you start your adventure in condo living?
Edward