Looks like a duck, acts like a duck, but it isn’t a duck. Think you are buying a condo but it is really a co-op? Think you are buying a single family but it is really a PUD? Three types of common interest developments …
- Condos – You purchase the inner surface of the walls, ceilings and floors. The building structure and land are defined as a common elements and owned by the homeowner association (HOA) which is made up of the condo owners. Each unit is assigned a % ownership in the common elements.
- Planned Unit Development (PUD) – A variation on a condo, you purchase the structure and the land beneath. The HOA owns the common areas and is responsible for maintenance etc.
- Cooperatives (Co-op) – You purchase personal property in the form a stock certificate which entitles you to a proprietary lease of the apartment. The building is owned by a non-profit corporation.
To avoid surprises, know exactly what you are purchasing well ahead of time.
