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Cooperative Living: Understand the Difference

There is no such thing as owning a coop.  A cooperative is a corporation.  Residents invest in shares. With the purchase of shares comes the exclusive right to live in a specific unit as a lessee of the corporation.


One of the biggest differences between home ownership and being a shareholder is frame of mind. Homeowners make individual decisions. Shareholders agree to live by the rules of the corporation and give up a great deal of individual decision making.  But they also give up much of the day-day-to-day responsibilities of homeownership.  (See sidebar).

Less Work and Worry


NOT the Shareholder's Job:

  • Landscaping:  Mowing,  fertilizing, leaf removal, grass repair, shrubbery care

  • Tree care:  Pruning, treatment planting, removal

  • Security

  • Plowing and snow removal

  • Facilities:  Common property such as pools

  • Building repair:  Roofs, exterior painting, brickwork. 

  • Road and driveway repair and paving

  • Utility repairs:  Gas and electrical

  • Insurance:  Building property

The Advantages of Cooperative Living


Cooperatives are governed by a board of directors elected by the shareholders. Board members are responsible for the administration of the cooperative’s assets. Unless a coop is very small, the board will retain a Managing Agent that is experienced in coop management to oversee finances, contractors and capital improvements. It is the freedom from managing these activities that makes cooperative living appealing especially to individuals, couples and families who want to lock and leave.



The Proprietary Lease and House Rules


Shareholders agree to abide by a proprietary lease and house rules when they purchase shares. These and any other documents such as an Alteration Agreement define shareholder responsibilities and what shareholders can and cannot do. It is imperative that a prospective buyer read all documents before signing. Boards act in the interest of the cooperation. Accommodations are uncommon.    

Maintenance: The Cost of Coop Living

Shareholders pay monthly maintenance which includes their proportionate share of operating and maintenance expenses, property taxes, property and flood insurance, mortgage payments (if any), management and professional fees, maintenance costs, all or some utilities and contributions to reserve funds.  Maintenance is reviewed annually and increases are announced to shareholders. 



Poningo Neck Apartment Cooperation

PNAC shareholders have fewer monthly bills than homeowners.  In addition to property taxes and operating costs, maintenance includes items such as water and window and boiler replacement. The few monthly expenses that shareholders do have are Con Edison, cable, internet service and mortgage expense if applicable. The corporation pays for building, property and flood insurance. Shareholders are advised to closely read the proprietary lease and to consult their insurance companies to make sure that they insure both the contents of their units, upgrades and other contingencies. The proprietary lease spells out what items are the responsibility of the lessor and the lessee in detail.  

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