Condos are quite popular and common throughout the rest of the U.S., however they are a rather new concept for the Big Apple. A condo apartment is real property. The buyer gets a deed just as though he/she were buying a house. Since this is real property, there is a separate tax lot for each apartment.
Hence, this means you pay your own real estate taxes for your property. An owner will also pay common charges on a monthly basis. Common charges are similar to maintenance in a co-op. However, they will not include real estate taxes since these are paid separately, nor will it include the building’s mortgage and interest given that a condo, by law, cannot have an underlying mortgage.
Condominiums are attractive for the following reasons:
- Financing the purchase of a condo is much more flexible than in a cooperative. Generally, a buyer can finance up to 90% of the purchase price.
- While there is an application process, this is not as formal as in a cooperative. The likelihood of rejection is minimal.
- There is greater flexibility in sub-leasing your apartment. This makes condos the choice for investment property.
- They are ideal choices for non-U.S. citizens or for those with their assets held outside of the United States given that co-ops are unlikely to approve a buyer whose funds are not in the U.S.
There are fewer condos than co-ops, and they are “easier” to purchase. As a result, they are more expensive than co-ops. Additionally, monthly combined common charges and real estate taxes in a condo are typically less than a co-op’s monthly maintenance charges, again resulting in higher purchase prices.