People looking to purchase an apartment will probably consider one of two options: a condominium or a co-op. Although they might look similar, they are somewhat differ. You should understand each before making a purchase.

If people have even heard of co-ops, they think of them as a varient of condos. But the differences are important to understand. When you purchase in a condo, you own a specific unit and have a deed for that real estate. When you purchase in a co-op, you own a share of the entire building but you don't own the real estate. In some sense, your purchase in a co-op is similar to purchasing stocks.

Co-ops are owned and managed by those who have purchased stock in the non-profit corporation. The corporation owns the building and all the installed equipment and fixtures in it. The corporation grants proprietary leases to resident owners. The rights conveyed include the right to live in your unit and to use the common elements of the corporation as spelled out in the co-ops legal documents.

In a condo, a purchase involved the transfer of a real estate deed to the purchaser. The installed equipment and fixtures in the apartment belong to the owner - not the corporation. Buying a condo is an actual purchase of real estate. In a condo, the residents have the right to use the common elements as spelled out in the condo legal documents.

In some cities where there are many co-ops, the banks understand them and provide mortgages to aid in the purchase of co-ops. In cities like Pittsburgh where there are a limited number of co-ops, the banks are less familiar with them and may not be organized to provide mortgages for co-ops. It is always good to check with your bank regarding mortgages.

From our examination of selling prices, it appears that co-ops tend to sell at a lower price than condos. The real estate taxes associated with condos tend to be lower than with condos because the entire building is receiving one tax bill while, in a condo, each unit receives its own tax bill. Co-ops also tend to provide centralized heat/AC and other utilities with the coop association paying for the utilities while condos do not normally provide these utilities or services. As a result, coop fees tend to be higher than those of condos. However, when you examine the total cost (fees plus your outlays for taxes and utilities for each), they tend to be little different.

With a condo purchase, the condo association has little control over who can purchase a unit. With a coop, the Board normally approves each applicant before a sale can be finalized.

With coop Boards being able to approve or reject who moves in, they frequently have and enforce a no rentals and no sublet policy. They also have the right to approve or reject roommates or others seeking to live in a unit. With a condo, the Board has limited rights to restrict rentals, subrentals or roommates.

It has been suggested that coops foster a sense of family, with residents looking out for each other and developing friendships. This has certainly turned out to be true at the Bristol Co-op.