There are important distinctions among different types of real estate — houses, condominiums, and
cooperative
apartments.
Houses
If you own a house, you own the building itself as well as the land it sits on. As owner, you are responsible for the upkeep of both.
You have the right to sell a house when you choose, to any buyer willing to pay the price you’re asking. If you have a
mortgage
on the property, some of the sale price goes directly to the lender to pay off the loan.
Condominiums
If you own a condominium, you own the living space within your unit. The building complex, including the outside walls of your unit, the land, and the facilities, such as a pool, are owned by the condo association. You’ll owe property tax on your unit, and sometimes on a percentage of the shared facilities.
You’ll owe a monthly maintenance fee to the condo association, which is responsible for upkeep of the complex. You are also subject to the community guidelines, which may restrict the changes you can make to your unit.
You can sell your unit to any buyer you choose. If you have a mortgage, part of the sale price goes directly to the lender to repay your loan.
Cooperatives
If you buy a cooperative apartment, or co-op, you don’t actually own the unit you live in. Instead you own a share in the cooperative corporation, which grants you the exclusive right to live in your unit indefinitely, provided you abide by the rules of the cooperative.
Your share of the property tax and your monthly maintenance fee are based on your percentage of the building’s square footage. The co-op corporation is responsible for maintaining the building and grounds and enforcing community regulations.
Local governments and homeowners associations may impose rules restricting the kind of structural or aesthetic changes you can make to your home, or they may limit the way in which you can use it. For example, in some communities, you may not be able to run a business out of your home or subdivide the space into more than one living unit.
Some but not all co-op corporations require any prospective buyer of your shares — and the right to occupy your space — to be approved by the co-op’s board before you can finalize the sale.
