I get lots of questions from buyers about the difference between buying a co-op apartment in Chicago and buying a condo. Below are the key differences between the two.
| Co-op Apartments | Condos | |
|---|---|---|
| Assessments | Co-op monthly assessments cover the same expenses as for condos (see right) plus 1/12th of the property taxes (see Property Taxes below) and any building mortgage (see Financing Special Projects below). | Condo monthly assessments cover expenses for staff, maintenance, reserves, and any utilities provided by the condo association. |
| Financing | Down payment requirements are higher for most co-ops in Chicago. A few require a minimum of only 20% down. Many allow 50% financing. Some are cash only. | The condo associations don't set minimum down payments. |
| Financing Special Projects | Co-ops are able to finance special projects via a mortgage for the building. In some circumstances owners may be able to deduct their portion of the interest on that mortgage. Consult your accountant for details. | Condo associations are not able to mortgage the common elements of the building. If there is not enough money in the association's reserves, the association can have a special assessment paid by the owners. |
| Form of Ownership | Buyers purchase shares of the corporation that owns the co-op apartment building. A proprietary lease gives the buyers the right to occupy a specific apartment. | Buyers own their unit and become members of the condo association which owns the common elements. |
| Purchase Approval | After signing a contract to purchase a co-op apartment, buyers must submit to the co-op's board an application including financial information and letters of reference (both professional and personal). Buyers must also be interviewed by the co-op board. The focus of the approval process is on the buyers ability to pay their monthly assessments since an inability to do so would put a financial burden on the rest of the co-op owners. The board must abide by Fair Housing Laws. | A very few condo associations reserve the right to approve buyers. Approval is much less involved than for a co-op, The association must abide by Fair Housing Laws. Some condo associations have the right of first refusal allowing them to purchase a condo, if they feel the price is too low. |
| Property Taxes | Since there is only one property tax bill for the entire apartment building, an owner's portion is paid to the co-op through the monthly assessment. | There is a property tax bill for each unit payable directly by the owner of the unit. |
| Renting Units | Most co-ops in Chicago do not allow apartments to be rented out. A few allow rentals on a limited basis such as a maximum of 2 years. | Many condos allow units to be rented out, but have rules such as the minimum length of leases. More condos in Chicago have been prohibiting rentals for new buyers recently. |
| Transfer Fees | A few co-ops charge a transfer fee of 1% to 3% of the sale price. This is in addition to Chicago's buyer transfer tax which is 0.0075% of the sale price. | Condos don't have transfer fees. As with co-ops Chicago's buyer transfer tax which is 0.0075% of the sale price applies. |
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Fran Bailey specializes in downtown Chicago, Lincoln Park and Lake View condos, co-op apartments and houses. She has shared home buying and selling advice since 2006 and written about over 130 Chicago high rises. To schedule showings for any listings, get a 
