Buying a Condo? You Might Want to Consider a Co-Op Instead

Feb 10, 2023

There are many benefits to living in a condo: They often require less maintenance than single-family homes, as the condo association often maintains the common interior and exterior areas. As a result, condos can often offer more flexibility than single family homes for people who like to maintain active lifestyles.

But condos aren’t the only type of multi-living units that provide these types of benefits. Co-ops offer many of the same benefits, so they could also be what you’re seeking.

What is the difference between the two? Not much, but there are some differences that could be important to you. With a condo, the title to each individual unit is in the owner’s name – you are purchasing the property as if you are buying a home – while the residents in co-ops own shares in the entire building, enabling them to “lease” and live in a specific unit.

Compared to owning a condo, there are some potential advantages to buying shares of a co-op; they can include:

  • Lower price: Condos often cost more to buy than a comparable property in a co-op.
  • Lower real estate taxes. Taxes are assessed against the co-operative as a whole and are generally lower than for a similar sized and priced condominium unit.
  • There is often less turnover in a co-operative creating a more stable living environment.
  • Increased financial safeguards: Since buying into a co-op generally requires an interview with the potential buyer as well as their financial statements and credits reports before a board would grant approval to purchase shares of the co-op, there are more assurances that residents can pay their monthly assessments.

While every situation is different, there are of course potential drawbacks of owning shares in a co-op. Many of these potential downsides are connected to other potential benefits. Drawbacks could include:

  • Higher comparable monthly assessments: Co-ops often have higher monthly fees than condos, as they’re needed to cover not only the cost of maintaining the common areas, but they’re also needed to cover additional building-wide expenses, including taxes.
  • Co-operatives are harder to finance: Not all mortgage lenders have loan products for co-operatives.
  • May have to pay cash: Not all co-operatives allow financing, and if they do, may require a significant downpayment.
  • Slower to sell: When selling a co-op unit, the board can turn down a potential buyer for any reason and, as mentioned above, the co-op board typically conducts background checks before approval, so the closing process can take longer.
  • Restrictions against renting: While some condo associations might impose limitations on renting and subletting, you’re more likely to find this constraint in a co-op. What’s more, if the co-op does allow subletting, you’ll probably need approval from the board for those who will be renting from you, because you do not literally own the unit (just like the interview you needed to go through to buy into the co-op).

Evanston has several elegant, luxury co-cops. If you’re considering a condo, you might add co-ops to your consideration list. They can give you more for your money – and be just what you are seeking in a new home.

And whether you’re seeking a free-standing home, townhome, condo, or co-op – or open to any type of option – my team and I are here to help you every step of the way, including helping you identify the type of home that’s right for you. If you have any questions about the types of home options available to you or any of the steps in your home buying (or selling) process, please feel free to email us at or call us at 847-274-6676.


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