Many New York City residents own cooperative apartments, or "Co-ops." This unique form of home ownership constitutes a rather unique living arranagement.
When you buy a Co-op, you become a shareholder in a corporation. Unlike a condominium or a house, you do not own real property. Instead, you own shares of stock and a proprietary lease allocated to your apartment. Because they do not own the building, shareholders have a landlord-tenant relationship with their Co-op.
Shareholders can receive a tax deduction for Co-op mortgages they may have, in additional to a tax deduction based upon the percentage of their monthly maintenance charges which are used to pay off any underlying mortgage held by the Co-op.
Like any corporation, Co-opīs are run by a Board of directors elected by the shareholders, along with the assistance of a managing agent. Shareholders may be subject to special restrictions imposed at the Co-op Boardīs business discretion (e.g., subletting, carpeting their floors). These rules and regulations, however, must not violate any existing rights under state or federal law.