Looking for a place to live in New York City isn't always easy. Condos, co-ops, and townhouses sprawl across the city. How do you find that perfect spot? And how do you even know where to look?
Here's the real question: do you know what kind of property you want? While co-ops, condos, and townhouses might sound similar, they share some crucial differences. Finding your perfect place in New York City requires you to drill down your finances, desires, and goals to discover which type of Upper East Side home makes sense for you. Let’s take a closer look.
What are Townhouses?
Townhouses are single-family homes where you are wholly self-sufficient — no boards, no supers, no handyperson, and no concierge. They are purchased directly using loans, and they have no bylaws preventing you from renting out the property. Some townhomes have small amenities, like a garden, roof deck, gym, or wine cellar. A few select townhouses even have parking garages and pools. That being said, you are responsible for everything — the boiler, the HVAC, the pipes, the roof, and any outdoor spaces — but you don't need board approval for renovations or renting.
You'll find most townhomes on the Upper West Side, Upper East Side, Chelsea, and in the West Village, but they exist all across Manhattan. Basic townhouses are more expensive than similar co-ops and condos, with the average townhouse price sitting around $9.25M. Luxury buyers seeking privacy are attracted to townhouse living, while luxury condos entice those seeking full service, open views, and amenities.
Privacy, Low Fees, and a Rule-free Life
People love the privacy of townhouses. You have your own unit, and you don't have to deal with noisy upstairs or downstairs neighbors. Another critical consideration is HOA fees. There are no common charges or maintenance fees, only property taxes. No HOA. No co-op board. You retain control.
Financial Requirements
Purchasing a townhouse is similar to buying a single-family residence. There is no co-op or condo board to deal with: No specific financial requirements and no board requirements. Anyone can purchase a townhouse, but you’ll need to secure a traditional or jumbo loan and contact private mortgage brokers. Often, townhouses are harder to find than condos or co-ops.
Key Considerations
- Townhouses are detached units with extra privacy.
- Townhouses do not have amenities like co-ops and condos.
- You can rent out townhouses at any point.
- Townhouses are fantastic investments.
- Townhouses do not have an HOA.
- You can purchase townhouses using traditional or jumbo loans from banks and mortgage brokers.
What are Co-ops?
When you purchase a co-op, you aren't buying real estate in the traditional sense. Instead, you're buying shares in a non-profit corporation: effectively, the building itself. So, everyone in the complex collectively owns the "corporation" (the building), which grants permanent leases to residents to live in their respective units.
It's estimated that 75% of residential buildings in NYC are co-op houses. Co-ops have been integral parts of New York City since prewar times. They vary in style, amenities, and price points, from full-service and grand Park Avenue buildings (with doormen, concierge, live-in resident managers, and maintenance crews) to post-war brick buildings and walk-up, non-doorman, and no-staff buildings.
Co-ops tend to have fewer amenities than the newest condos, but many co-op complexes have added gyms. Co-ops are also generally a little more affordable than condos — even if they are nearly identical units on the same block. Part of this is simply due to bylaws that make it challenging to sublease your unit.
Rules, Bylaws, and Community
Owning a co-op involves a set of bylaws and rules that every resident must follow. The management (or “board,” as they tend to be called) of the building approves or denies prospective buyers' purchases, meaning that the approval process for co-op units is relatively rigorous. Still, it helps keep the community tight and connected.
Another vital consideration when on the market for co-ops is subletting. Some co-op bylaws do not allow subletting. Others may only allow subletting after you have lived in the unit for a certain period of time. Because of this, co-ops often have a more substantial "sense of community." Most people do not purchase co-ops as investment properties to rent out, short or long-term; they eat, sleep, and live there, fostering a sense of home. If you’re interested in purchasing a co-op as a pied-à-terre, only living in New York City part-time, you’ll want to pay close attention to the fine print, as not all co-ops permit this.
Another vital consideration when on the market for co-ops is subletting. Some co-op bylaws do not allow subletting. Others may only allow subletting after you have lived in the unit for a certain period of time. Because of this, co-ops often have a more substantial "sense of community." Most people do not purchase co-ops as investment properties to rent out, short or long-term; they eat, sleep, and live there, fostering a sense of home. If you’re interested in purchasing a co-op as a pied-à-terre, only living in New York City part-time, you’ll want to pay close attention to the fine print, as not all co-ops permit this.
Due to subletting rules, co-ops are more challenging to use as investment properties. I often guide clients looking to invest in real estate towards more straightforward purchases like condos or townhouses. Nevertheless, there are a few co-ops in NYC with terms that favor investing, and I can help you navigate this as needed.
Financial Requirements
Co-ops often have more rigid approval requirements than condos. Unlike traditional real estate — which relies on relatively straightforward loan requirements from banks — co-ops require board approval. With some stricter co-op management boards, this may mean 50 percent cash down with hefty liquid asset requirements. Other co-ops have lower down payments (between 10 and 20 percent) and relatively uninvolved financial needs, but every co-op is different. Where to begin?
Key Considerations
- When you purchase a co-op, you own shares in a company (the building itself) — not real estate.
- Your shares give you access to your apartment and the amenities afforded by the building.
- Co-ops are often more financially accessible than condos.
- Your co-op shares can be resold.
- Many co-ops forbid subletting.
- Co-op buildings often have a strong sense of community.
- The co-op approval process is rigorous and highly variable.
What are Condos?
Condos are the hot trend in New York real estate. Most condos are newer than co-ops, and they generally offer more robust and luxurious amenities. When you purchase a condo, you own it. Every spacious linen closet, spa-like bathroom, and tranquil sitting area is your property. This makes condos fantastic hands-off investment properties — especially given the more straightforward application process.
Unlike co-ops, condo buildings are crowded with amenities and extras. You can find stunning perks like world-class private gyms, children's playrooms, basketball courts, dining rooms, and pet spas in and around NYC condos. Today, condos comprise the majority of the high-end apartments in NYC, though there are plenty of affordable gems on the market at any given time.
Investments, Applications, and Availability
In the late 1970s and 1980s, more than 3,000 rental buildings were converted into cooperatives. Many pre- and post-war buildings became co-ops. Today, most new developments are condos, so there's a discrepancy in co-op and condo availability — with the latter usually being more recent.
Investors crave condos in NYC, and overseas buyers often find condos fitting as vacation-style homes due to the lack of co-op bylaws. Condos are also fresher and often feature more luxurious amenities. You can find some examples in my sold listings or featured properties. Many units are also designed by renowned modern architects — like this recently-sold spot by Pritzker Prize-winning Christian de Portzamparc.
According to our latest Manhattan Market Report, condo prices were up 7.2%, and demand for luxury condos valued at over $20M rose by 233 percent in the past year. Finding condos in the $5 - $10M bracket and +$20M bracket can be particularly challenging. You need a top-tier agent to guide you through the "hidden" listings, hyper-competitive spots, and word-of-mouth gems.
Thankfully, NYC has a dense real estate market. You can also find easily-affordable condos. But they move fast. You should work with an agent who deeply understands the condo landscape in New York City.
Investors crave condos in NYC, and overseas buyers often find condos fitting as vacation-style homes due to the lack of co-op bylaws. Condos are also fresher and often feature more luxurious amenities. You can find some examples in my sold listings or featured properties. Many units are also designed by renowned modern architects — like this recently-sold spot by Pritzker Prize-winning Christian de Portzamparc.
According to our latest Manhattan Market Report, condo prices were up 7.2%, and demand for luxury condos valued at over $20M rose by 233 percent in the past year. Finding condos in the $5 - $10M bracket and +$20M bracket can be particularly challenging. You need a top-tier agent to guide you through the "hidden" listings, hyper-competitive spots, and word-of-mouth gems.
Thankfully, NYC has a dense real estate market. You can also find easily-affordable condos. But they move fast. You should work with an agent who deeply understands the condo landscape in New York City.
Financial Requirements
Condos work on leases like traditional homes. As long as you can secure a loan, you can purchase a condo. Here's the unique situation: Luxury and ultra-luxury condos require jumbo loans and super jumbo loans. Unlike traditional loans, jumbo loans are not guaranteed by Freddie and Fannie, so banks are often more hesitant to lend them out. Your real estate agent can help you navigate the financial landscape of jumbo loans.
Condos also have higher closing costs than co-ops. These costs include things like mansion taxes, recording taxes, and titles. However, the differences in closing costs typically aren't massive.
Condos also have higher closing costs than co-ops. These costs include things like mansion taxes, recording taxes, and titles. However, the differences in closing costs typically aren't massive.
Key Considerations
- Condos are often newer and more luxurious than co-ops.
- When you purchase a condo, you own the real estate itself.
- You can rent out your condo at any time.
- Condos give you less control over your neighbors, but they have a simpler application process.
- Condos make for stellar investments.
Which Type of NYC Property Is Perfect For Your Needs?
Everyone is different. Your unique life situation, living goals, and investment dreams should guide you towards the type of real estate for you. Need some help? I specialize in helping people from all walks of life find their dream home or perfect investment opportunity. From ultra-luxury condos to hyper-affordable co-ops, I'm ready to track down your dream spot.
Contact me to learn more about my services. Let's find you a home in NYC.
Contact me to learn more about my services. Let's find you a home in NYC.
