Condo vs. Co-op: What are the Differences?

Condos and co-ops both combine individual and joint memberships of a property. They are also both governed by a set of conditions, covenants, and restrictions (CC&Rs). For these reasons, they are often confused with one another.

If you’re a real estate agent with clients interested in owning property without the commitment of a standalone home, condos and co-ops are worth considering! But first, you’ll need to understand the differences yourself so you can point your clients to the option that best suits their needs.

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What Is a Condo?

Condos are privately owned units within a larger building of units. When you purchase a condo, you are actually buying an interior unit in the building, but not any of the exterior or common spaces. 

Condos are governed by condo associations, which are just like homeowners associations. The condo association takes care of maintaining and repairing the exterior and common areas of the building. This includes things like yardwork or general upkeep of shared areas within the building.

The association also sets rules for the building, which all condo owners must abide by. In exchange for the work done by the condo association, owners pay monthly fees. 

Typically, buying a condo is less expensive than purchasing a single-family home, although it does come with monthly fees. However, that means that condo owners will have less upkeep to take care of themselves than if they owned a house. 

What Is a Co-op? 

Co-ops are a type of shared housing that is owned and operated by a corporation. When purchasing a co-op, you’re actually not buying ownership in the property itself, but in shares of the corporation. The more shares you own, the more space you’re given to live within the property. 

With co-ops, shareholders collectively vote on issues that affect both the tenants and the property. Volunteers within the co-op community collect the maintenance fees and take care of upkeep and repairs. The co-op board may also hire a property manager to take care of the daily building needs. The board also reviews applications for the property and makes decisions regarding who can buy shares of the corporation. 

Because co-ops are less expensive than buying a house or a condo, they’re commonly found in larger, crowded cities like New York, Chicago, or Washington D.C.

What’s the Difference Between a Condo and Co-op? 

Real Estate

Condos are individual real estate properties. When you buy a condo, you are purchasing an interior, not the exterior, portion of a condo building. Your condo comes with a deed, proving that you are the sole owner of a real property. 

Unlike condos, co-ops are shares of a corporation and don't include actual ownership of property. Rather than individual ownership of a property, the corporation owns everything. When you buy shares of a co-op, you don’t receive any deed or proof of ownership; your purchase just allows you to live on that property. 


When you purchase a condo, you become the sole owner of the interior unit. Your actions as the condo owner do not affect the actions of other tenants in the building, nor can you control the actions of the other tenants. 

Co-op participants are collective owners of the property. Their actions cannot be independent of one another. All tenant actions will affect the other tenants, and decisions about the property must be made as a group. As an investor in the co-op, you have a say, or control, in how other investors live within the co-op. 


While purchasing a condo, you won’t typically have to deal with any application processes or interviews. You will simply purchase the property, or you can easily sub-lease it to someone else. Rules set by the condo association don’t limit who is allowed to buy a condo. 

On the other hand, co-ops have a lengthy and in-depth application process, since board members are usually pretty picky about who can join. Since co-ops are very community-oriented, co-op boards want to make sure that potential buyers will respect the rules and pay their fees. Buying shares of a co-op will typically come with in-person interviews, a deep dive into your financial documents, and approval from the co-op board.

Now that you know the difference between these two types of properties, it's time to help your clients find the perfect home. Take your pre-licensing or training courses from Aceable Real Estate School today to get certified in your state.

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