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Condominium Apartments

While condominiums are quite common throughout the United States, they are a rather new concept for New York City. Condominium apartments are, however, becoming more popular and ubiquitous in New York City. Unlike cooperatives, condominium apartments are real property, akin to the purchase of a house. Instead of shares in a corporation, a buyer receives a deed to the apartment itself. Each owner is responsible for his own real estate taxes and his own mortgage payments. Although a Condominium's Board of Directors (the "board") usually imposes a monthly common charge on each apartment, these charges are limited to each apartment's share of the building's costs of maintenance and general upkeep.

Unlike the purchase of a cooperative apartment, there are no limits of the amount of the purchase price that can be financed by a mortgage. Additionally, although the purchaser must present a purchase application package to the Board (often with financial disclosures), the application process is less formal than for co-operatives. A Board meeting may or may not be required and an applicant is almost always accepted except for the rare occasion when the condominium exercises the option to buy the apartment itself. The length of time for Board approval varies from building to building, but it is usually not as long as the co-op approval process.

CONSIDERATIONS WHEN BUYING A CONDOMINIUM:

Owners will need to maintain insurance coverage on the dwelling.
Rules about leasing are very relaxed. The Board cannot turn down a renter and leave the owner without alternatives. Usually, if a renter is rejected, the Board is obligated to rent the apartment under the same terms and conditions expressed in a bona fide lease agreement. Since there is greater flexibility in leasing your apartment, condominiums serve as better investment vehicles than co-operatives.
Unlike a co-operative apartment, a condominium is real property. As a result, a real estate tax imposed for each apartment. The owner of the condominium is responsible for paying the real estate tax, which is not included as part of the building's separate monthly common charges.
Owners are required to pay monthly common charges, which are similar to maintenance fees in a cooperative. However, common charges will not include real estate taxes since these are paid separately, nor will they any building mortgage and mortgage interest since, by law, condominium cannot have an underlying mortgage.
Condominiums are the ideal choice for non-U.S. citizens, or for those with assets held outside of the United States. Unlike Condominiums, co-operatives are unlikely to approve a prospective buyer whose funds are not held in the United States.
Generally, monthly combined common charges and real estate taxes in a condominium are lower than a cooperative's monthly maintenance charges.
Given that there are fewer condominiums than cooperatives and that they are "easier" to purchase, they are generally more expensive than cooperatives.

CONDOMINIUM PURCHASER'S ESTIMATED CLOSING COSTS:

The figures below are presented as a guideline only. Actual closing costs will vary for every transaction. Before signing any contract, buyers should have all closing costs explained to them by their attorney and bank loan officer.

Buyer's Attorney (negotiated flat rate):	$2,000±
Bank Fees (if financing):	$1,600± (application, credit, appraisal, bank attorney, etc.)
Recording Fees:	$200-$750
Mortgage Tax:	1.75% of mortgage amount (on loans under $500,000); 1.875% of mortgage amount (on loans over $500,000)
Mortgage Title Insurance:	Approx. $200 per $100,000 if financing
Fee Title Insurance:	Approx. $450 per $100,000
Mansion Tax:	1% of purchase price (if price exceeds $1,000,000)
Lien Search:	$300±
Managing Ageny:	$450±
Common Charge Adjustment:	up to one month (Pro-rated for month of closing)
Real Estate Tax adjustment:	1 to 6 months (Pro-rated for month of closing)
Short-Term Interest adjustment:	up to one month (Pro-rated for month of closing)
Misc. Title Charges:	$300±

Note: When purchasing a condominium unit from a Sponsor, the Purchaser will be required to pay New York City and New York State Transfer Taxes (1.875%) as well as the Sponsor's attorney's fee.