If you want to live in a an elegant building with very large square footage in the unit, you might want to consider a co-op. But before you start the process of looking, know the difference between purchasing the co-op and a Chicago condominium…Most co-ops are priced less per square foot than a condo, however, the concern when purchasing a co-op is the monthly assessment fees. The fees are high but do include taxes which are deductible and also usually include the heat, door staff, parking and in some, even electricity.

Since you do not own the unit but rather shares in a corporation you may be required to put at least 20% to 25% or more, as a down payment. Note, some Chicago Gold Coast cooperatives do not allow financing hence the need for a large amount of cash. In addition, in the Gold Coast co-ops, you may also need a large amount of liquid assets to be accepted into the building. Note, be prepared for a thorough screening of your assets as the corporation does not want to assume responsibility for another shareholder’s assessments.

Also be aware, since co-ops are usually older buildings, many of them have taken out loans or have special assessments to do tuck pointing or special repairs.

When purchasing a Chicago condo, the board doesn’t ask to review your financial assets and you own your unit outright. Although you should still check the financial health of the building, a condo is easier to ascertain if there are any financial issues.

Note, I typically do not recommend clients purchase a co-op. Although co-ops are typically priced lower than the “condo” market, they are harder to sell and more difficult to finance than a condo. Hence, it is not unusual for a co-op unit to be on the market for six months to a year.

Tags: Chicago Co-op, Chicago Condo, Chicago Condos, Chicago Real Estate