In New York an apartment is bought in one of two forms — a condominium or a co-op. A co-op is cheaper both at entry and to run, but its board almost always turns down a foreign buyer's application. A condo costs more, but it is open to a non-resident and rents out freely. We set out how the two forms differ and why the choice is usually made for a foreigner in advance.
Contents:
- Two forms of ownership: the difference
- The board: why a co-op is closed to a foreigner
- Letting and pied-à-terre: where there is more freedom
- Money: price and running costs
- What this means for a foreigner
- Popular questions
Two forms of ownership: the difference
A condo (condominium) is ownership of the apartment itself. You hold title to real property (a deed), as with any ordinary asset.
A co-op is ownership not of the apartment but of shares in a corporation that owns the whole building, plus a right to live in your unit (a proprietary lease). It is not real property in the usual sense but a stake in a legal entity. There are roughly twice as many co-ops as condos in the city, but condos come up for sale more often.
The board: why a co-op is closed to a foreigner
A co-op is a closed club with its own board. The buyer fills in a detailed application, discloses their finances, sits an interview, and the board can refuse for almost any reason and without explanation. The down payment is usually from 20%, in luxury buildings 30–50%, and sometimes the deal is accepted in cash only. A foreigner with no US credit history or bank accounts is, as a rule, not let through by the board.
A condo works differently. The building only has a right of first refusal — in theory it can buy the apartment itself instead of the buyer, but in practice that happens very rarely. There is no approval as such. The down payment is from 10%, and up to 90% of the price can be financed.
Letting and pied-à-terre: where there is more freedom
A co-op sharply limits or bans letting. Some buildings allow subletting for, say, two years out of five and only with the board's approval. For an investor that is a poor fit. A condo lets out freely and works both as a rental and as a second home for occasional visits.
There is an important link here with the tax on a second home. An apartment can be taken out of that tax by a long-term let, but in a co-op letting is often banned — so that option mainly works for a condo. On the tax in detail — in the article on the pied-à-terre tax.
Money: price and running costs
- Price. A condo costs more: in Q2 2026 the Manhattan median for condos was about $1.84M against roughly $895K for co-ops. The gap is largely down to the newer condo stock.
- Running costs. A co-op has a single payment — maintenance, which includes both the property tax and the building's costs, averaging around $3,000 a month. A condo has common charges and property tax separately, averaging around $4,500 a month in total. The monthly burden is higher for a condo.
- Liquidity. A condo is easier to resell: there is no barrier of a board that vets your buyer in turn.
What this means for a foreigner
For a non-resident the choice is usually settled in advance. A co-op is cheaper at entry and to run, but a co-op board rarely approves a purchase by a foreigner, limits letting and demands a large down payment. A condo costs more, both on price and on monthly outgoings, but it is open to a foreign buyer, lets out freely and is easier to resell. That is why foreigners, investors and buyers of a second home for occasional visits take almost only condos. We work out the full cost of owning either form in the separate article on costs.
Popular questions
Can a foreigner buy a co-op?
Formally yes, but in practice a co-op board almost always turns down an application from a non-resident with no US credit history or bank accounts. Foreigners buy condos.
Which is cheaper — a condo or a co-op?
A co-op: both the price (a median of about $895K against $1.84M for condos in Q2 2026) and the running costs are lower. But a condo is more open to a foreigner and freer to let.
Can you rent out a co-op apartment?
Often not, or only with strict limits and the board's approval. A condo lets out freely.
Does the pied-à-terre tax apply to both types?
Yes, to condos and co-ops alike. But "escaping" it with a long-term let usually works only for a condo.
