Residential Lease For Unit In Condominium Or Cooperative: Fill & Download for Free

The Law abhors uncertainty, and all real estate transactions and interests are based on very clear and specific understandings and legal structures. Typically, the ownership of a building would be subject to leases that were executed, so that while the building might pass to a new owner, the new owner would still be subject to the original leases, until they expire.In the case of a residential/commercial mixed-use project, where the residential units were sold, not rented, the legal structure would typical be either a condominium (in which each component is owned separately, and therefore not subject to going into bankruptcy because another component does) or a “cond/op” (a legal structure relatively unique to New York City) in which the overall development is divided into condominium units for the commercial and the residential components, and then the residential portion is sub-structured as a cooperative corporation.But in any event, rarely will the bankruptcy “of a building” directly affect the occupants.

As a community association manager I’d say this question is not a simple black/white.There are (basically) 3 types of residential community associations: planned urban development, condominium development, and cooperative development.While everything is state-dependent, it is possible for a CA (community association) to levy fines for covenant or rule infractions. And, again being state-dependent) record a lien against the property for unpaid fines; then, finally, foreclose the lien. This would be for PUDs and condominiums.In the case of cooperatives, the coop owns the land/property (such as a lot or a unit in a building) and the owner “buys into” (purchases a share) in the cooperative. In this case, the owner is bound by the terms of the Master Form Lease, Rules & Regulations, etc. I have managed several coops and in the case of persistent rule-breaking owners I have had the coop’s attorney send the owner a final desist notice or the leasehold would be terminated.So, in my experience, with PUDs (what are commonly called HOAs) and condo associations I find would find it unusual for the association to “make you move” for violation of the CC&Rs or Rules & Regs, though it’s not out of the realm of possibility. In the case of a cooperative association, it’s distinctly possible; as I’ve stated, I’ve started the process several times.

Owning real estate is the American Dream. For hundreds of years, American’s have sought to own the dirt they live on, from the Wild West and homesteading to today’s luxurious New York City condominiums. We have been successfully navigating real estate ownership and rentals for hundreds of years, so the good news is you don’t have to reinvent the wheel. You just start by understanding the basics of the industry and how it works. Before you know it, terms like CC&R, HOA, , HOA, fiduciary responsibility and rent control will become part of your everyday vocabulary.Let’s keep it simple and think of real estate as the dirt you are standing on, the stuff found under the ground and the air above. Sometimes we just think of real estate as the physical building, but you should think about all three aspects of real estate which include 1) the property (2) the Money (3) and Me. Owning real estate is a lot of fun and you are ready to go to make your fortune and you have taken a great first step by picking up this book because real estate also has some risks involved with ownership. Take the time to read through this book to get a better understanding of the basics on which you will be able to create wealth and have fun.Investment GoalsIs your goal to build equity in the property? Create a positive monthly cash flow? Create the biggest tax deduction? Have a property you can use from time to time? Simply rent until the real estate market gets better? While resale value depends on the property’s location, among other things, single-family homes are typically easier to resell and hold their value over the long-term. However, a condo building with 500 units may have 10+ units for sale at any given time, making it difficult to sell your particular unit at a competitive price. Coops generally limit how you can rent your property and may not produce the financial returns you are looking for.Make sure you are clear on your goals, particularly what you expect to get out of the property and why. These answers help you to make a better purchasing decision now and assessment of your success later.Make a Choice: Types of Real EstateThe first question you need to ask yourself before acquiring any real estate is, “What kind of real estate do I want to buy?” Maybe you always wanted an apartment building, or a time share? Maybe a condo or cooperative intrigues you? Why does it matter? Well if you choose to buy a condo with the goal of renting it weekly, you may find out that it’s against local laws and won’t help you to fulfill your investment goal. For example, it’s against the law in New York City to rent a residential property for less than 30 days.Determining what kind of property you want will determine how much you can expect to spend and how much time and energy you need to take care of the property.Here is a list of types of real estate you may be interested in. In this book, we are going to focus most of our attention on investing in a single family home versus a condo, but it’s important to know other types of real estate that is available for you. Keep in mind that terms used on the west coast can be different than those on the east coast. For example, an apartment on the east coast is called an apartment, but in real estate terms it may be a condominium. I have also found over the years that people frequently use the incorrect term when referencing real estate so you need to know when it someone using a term in general or when are they talking about a specific type of real estate.Apartment: A residential unit located in a building that is leased by a tenant for a specific period of time. Individual apartments cannot be bought and sold. These units exist inside larger building that are bought and sold.Multi-unit building/Apartment building: An apartment building is a building comprised of multiple apartments that are owned as an entire complex. Individual units are not independently owned as in a condominium building. The positives of owning an apartment building is a) the potential for higher cash flow and b) the fact you are spreading your income over multiple tenants. However, remember that with an apartment building you are responsible for maintaining the building’s interior and exterior, including the common areas and each individual unit. Buying an apartment building is a little more complicated than buying an individual condominium, so you’ll need to learn more than just the basics. For example, buying a building with up to 3 units is similar to buying and financing an individual condo. However, buying a multi-unit apartment building with 4 or more units is more like getting a business loan and requires much larger upfront fees than typical residential mortgages. The good news is once an apartment building has been properly financed the loan can be assumed by the new owner.Condominium or condo: A condominium is a residential building with multiple units where each unit is individually owned. Each owner has exclusive right to their unit and has a ‘common’ interest in the common areas. Condo is an abbreviation used for a single unit located in a condominium building.Flat: A flat is a condominium that is generally an older, single residential property that has been subdivided into condominium units consisting of one unit per floor.Tenants in Common: Also known as TIC, this is a type of ownership between two or more persons in the same building where the building has been structured as a TIC. Similar to a condo unit, a TIC property is a building with multiple units and owners. However, each owner has an undivided interest in the whole property. (Caution: Don’t just jump into a TIC as an investment. There are some unusual rules you may need to follow. For example, you can sell your interest but you cannot will the property to your heirs.)Co-op/Cooperative Ownership: This is ownership in an apartment unit where you buy shares in the corporation (partnership or trust), but you do not specifically own your own unit. Basically you are just a stockholder in the building.Duplex/Triplex: A residential property -- under one ownership -- that may have two or three units side by side. Each unit has its own outside entrance. Also known as an attached single-family dwelling.Townhouse: Also referred to as a row house, the townhouse is a hybrid of a single-family home and a condominium. These are individually owned residential properties connected by a common wall where the owner owns both the structure and the land beneath the structure and generally a common interest in common areas like sidewalks, open space and recreational facilities.House/Single Family Residence: A self-standing residential property under single ownership designed to be used by one family.Timeshare/Partial Ownership: A newer form of communal ownership where you buy the right to use a property for a fixed amount of time with expenses pro-rated based on ownership percentage. This type of ownership is general used in resort areas and designed more as a hotel alternative rather than investment real estate.Decisions, decisions, decisionsNow that you know the different types of real estate properties available to you as an investor, what is best for you and what makes a better rental? Is it best to purchase a single family home or a condo? Is it better to purchase an apartment building or a cooperative?There are many factors to take into consideration when deciding on the right type of investment property for you, such as:UpkeepHow much time do you have to take care of your investment property? For example, single-family homes take more time to manage and require a more active, hands-on investor as compared to a condo. Single-family homes typically require extra upkeep and maintenance, especially if they are older properties, including regular yard maintenance, exterior painting, roof repairs, etc. On the other hand, if you are the owner of an individual condominium, you are only required to maintain the unit interior. Generally, the upkeep of the exterior and common areas is maintained by the Homeowners Association (HOA). The unit owner pays monthly fees to the association. The association creates a financial reserve from these fees and uses it to manage major exterior updates or repairs when necessary, (i.e. a new roof). For investors with little time, a condo can be a great, worry-free way to go.CostsSingle-family homes come with monthly costs like trash, heating, water, and lawn mowing, etc. Some of these costs, such as heat and water may fluctuate depending on the season and the occupancy of your property. Your costs will vary depending on whether your home is vacant, has one tenant, or has multiple tenants. Condos require you to pay a monthly assessment, regardless of whether someone is living in the unit. However, most condos include the costs of heat, exterior maintenance, trash, building insurance, and water in the fixed monthly fees.