Washington, DC and its surrounding areas consist of many different home types. Among these are condominiums (condos) and cooperatives (co-Ops). Physically, a condo and a co-op look the same from both the interior and exterior. The difference lies in the ownership interest of one of these units.
In a condominium, an individual or entity owns the physical condo unit and has a common interest in the common areas (lobby, gym, gardens, etc.). The condo owner is responsible for their own insurance, property taxes, and utilities. There is generally a monthly or quarterly condo fee that each unit owner pays towards maintaining the common areas, paying staff, and contributing to a reserve fund.
In a cooperative, an individual or entity owns shares in the cooperative corporation. The owner does not own the physical unit they inhabit. Co-ops generally have a lower sales price than condos, with a higher monthly fee. This is due to a cooperative building being taxed and insured as one common interest. Therefore, the monthly fee includes common area maintenance, staff pay, reserve funds, property taxes, insurance, and sometimes utilities.
Co-ops are typically more difficult to finance, but there are many lenders who will work with this ownership type. When purchasing a condo or co-op it is important to consult a real estate professional to fully understand the ownership types and bundle of rights included with both.
Jake Gaddis is a licensed Associate Broker in DC, MD, & VA with TTR Sotheby’s International Realty.