Connecting You To The Heart of Homeownership

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Understanding Co-Op Housing: Is Cooperative Housing Right for You?

Mar 24, 2025, 20:29 by User Not Found

Here’s what you should know about co-ops and whether they might make sense for you.

Article from HouseLogic.com

By: Jeffrey Steele

First-time home buyers have an option they may need to know more about: co-ops.

Especially when you’re buying your first home, you want to consider all your options. That’s even more important when affordability and supply are challenges. You may be unaware of the option of a housing cooperative, or co-op housing. Or you may may think co-ops are exclusive to New York City. But they do exist elsewhere, although they’re concentrated in certain areas. Here’s what you should know about co-ops and whether they might make sense for you.

What is Cooperative Housing?

A real estate cooperative is a communal housing type that originated in New York City, says Andrew Kontzamanis, associate attorney at Serpico, Serpico & Siddiqui, P.C. in Brooklyn, N.Y. He regularly represents co-op buyers and sellers, co-op corporations, and lenders. For a few years, he was a co-op shareholder-tenant, and he currently sits on the board of a co-op in Brooklyn.

One distinctive feature of a co-op is that the buyer is purchasing stock in the corporation that owns the co-op’s land and structures. Shares purchased are allocated to specific units. The tenant-shareholder has a lease with the corporation that establishes the respective rights and responsibilities in occupancy, maintenance and repair, and other matters, Kontzamanis says.

“The co-op corporation, not the shareholder, is typically the sole owner of the property and structures on which the co-op exists,” Kontzamanis says. “Some co-ops are long-term – for example 99 years – tenants of a building or property.”

The co-ops’ elected board of directors governs the corporation’s affairs, usually authorizing a professional management firm to handle day-to-day activities. Those might include cleaning and accounts payable.

How Does Co-op Housing Work?

Co-ops and condos are both types of communal housing, but co-op housing works differently from condos in several ways:

Co-op ownership is represented by a stock certificate and lease; condo ownership, by a deed to real property, Kontzamanis says. With condos, you don’t own shares; instead you own the actual unit where you reside, says Jeffrey Schwartz, managing partner at law firm Schwartz Sladkus Reich Greenberg Atlas LLP, in New York City. Schwartz represents a large co-op and condo practices in New York City.
Condo buyers in New York State pay a mortgage tax on funds borrowed to buy a condo unit. No such tax is levied on funds borrowed to buy a co-op, Kontzamanis says.
“Most often, a co-op cannot be bought or sold without the board of directors’ consent,” Kontzamanis says. “Such consent is not required for a condo transfer, although many condominiums do have a right of first refusal to purchase a unit that is for sale.”
Co-op housing is less common than condos in the U.S., so co-ops are in a niche market, says Alexei Morgado, CEO and founder of Lexawise, a real estate exam preparation company in The Woodlands, Texas. Condos are available in urban, suburban, and rural settings, but co-op housing is more localized. Co-ops are highly concentrated in New York City, with about 75% of Manhattan’s apartment ownership market comprised of co-ops, Morgado says. “There are some co-ops outside of New York City, particularly in cities such as Chicago, Washington, D.C., and Minneapolis, but they are very few compared to condominiums. Traditionally, co-ops have been found in locations that prize accessibility and shared ownership. They are generally high-rise or multi-unit buildings that appeal to people [interested] in shared amenities and a close community atmosphere.”

The Pros and Cons of Cooperative Housing

Like all housing types, co-ops have pros and cons.

Co-op Housing Pros

Selectivity: Co-op boards are selective, which can help weed out problem neighbors. The boards of co-ops have much greater latitude to decide whether a newcomer can move in, Schwartz says. “They can do a much more thorough analysis, meet the individual and get references,” he adds. “That could be a positive or negative, as some boards might use that power for good or bad.”
Control over resident conduct: Co-op boards also have more control over the conduct of residents, Schwartz says. That could result in less-disruptive behavior from neighbors. “If the conduct is not conducive to communal living, the board has a weapon – the right to evict – to remove the individual from the building,” he says.
Restrictions on owners renting out their units: “Either you can’t rent at all, or you can only rent two out of every five years,” Schwartz says. “I always like to see buildings where there is a large percentage of owners who occupy as opposed to renting their units out.”

Co-op Housing Cons

Complicated processes and rules: Co-ops tend to impose burdensome application processes and restrictive rules and policies on residents, Kontzamanis says. “[Condos] afford owners more flexibility for renting or renovating their units.”
Limits on purchases and sales: Most often, the board of directors has to consent to a co-op purchase or sale, Kontzamanis says. “Such consent is not required for a condo transfer, although many condominiums have a right of first refusal to purchase a unit that is for sale,” he adds.
Lower value: Co-ops tend to carry less value than condos. Condo owners have fee-simple ownership of their units. “The market values that as higher than it would stock ownership in a property as a lessee under a proprietary lease,” Schwartz says.

How to Finance Co-op Housing

When it comes to applying for financing, the process for co-ops is remarkably similar to financing other housing types, Kontzamanis says. “Lenders evaluate applicant income, assets, and credit, as well as the value of the co-op unit itself,” he says.

“The borrower will execute a note and security agreement in favor of the lender,” Kontzmanis says. “And a UCC-1 [Uniform Commercial Code] Financing Statement will be recorded in the local clerk’s office to reflect and protect the lender’s interest. When applying for a co-op loan, it is best to work directly with a local lender rep [with] experience with co-operative lending.”

When you’re looking for a real estate professional who knows the co-op market, similar advice about going local applies. “I would find someone local,” Schwartz says. “In New York City, agents have a tendency to know the whole market. You don’t see agents here who only do the East Side or only do the West Side. In towns and local areas, the broker in that area will be the most familiar with co-ops and properties in that same area.”

Questions to Ask About Co-op Housing

You’ll want to ask questions to evaluate a co-op you may be considering and to double-check your comfort level with co-op housing processes, rules and regulations. Here are three to start with.

How well run is the business? When you buy a co-op, you’re purchasing into a business. Would-be buyers should try to ensure the business they’re considering is very well run, Schwartz says. “We look at the offering plan, the minutes of the board meetings, and what capital expenses will come up down the road,” he says. “For instance, will there be a boiler or a roof replacement required in the future? We also generally have conversations with both the building’s managing agent and the building’s accountant.”
Am I willing to divulge all my financial records in the application process?
Am I willing to be bound by the co-op’s rules and regulations?

If co-op housing is an option in your market and you think you might be interested in pursuing one, make sure to do some legwork. Most importantly, carefully weigh the pros and cons for both this type of housing and any specific building you’re considering.

LIBOR HOMESELLER FAQ

What are the benefits to working with a REALTOR®?

REALTORS® aren't just real estate agents. They're members of the National Association of REALTORS® and subscribe to its strict Code of Ethics. When you're selling a home, here's what an agent who's a REALTOR® can do for you.

Act as an expert guide. Selling a home typically requires a variety of forms, reports, disclosures, and other legal and financial documents. A knowledgeable real estate agent will know what's required in your market, helping you avoid delays and costly mistakes. Also, there’s a lot of jargon involved in a real estate transaction; you want to work with a professional who can speak the language.

Offer objective information and opinions. A great real estate agent will look at your home with an unbiased eye, providing you with the information you need to enhance marketability and maximize price. Agents are also a great source for potential buyers who have questions about local utilities, zoning, schools, contractors, and more.

Deliver property marketing power. Property rarely sells because of advertising alone. A large share of real estate sales come as the result of the listing agent's contacts with other industry professionals, previous clients, and others in their sphere.

Give you a sense of security. Risk is a fact of life. To minimize it, real estate agents follow protocols to ensure their own safety, as well as the safety and security of you and your property. A professional agent will prescreen prospects and accompany qualified prospects through the property. They'll also help educate parties about how to prevent fraudulent dealings, such as wire fraud, that can put sales at risk.

Stand in your corner during negotiations. There are many factors up for discussion in any real estate transaction. A real estate professional will look at offers from your perspective, helping you navigate the fine points to ensure you're meeting your objectives.

Ensure up-to-date experience. Most people sell only a few homes in a lifetime, usually with quite a few years in between each sale. Even if you’ve sold a home before, laws and regulations change. Real estate practitioners may handle hundreds or thousands of transactions over the course of their career.

Be your rock during emotional moments. A home is so much more than four walls and a roof. For many owners, selling a home means saying goodbye to the place where cherished family memories were made. Having a concerned but objective third party helps you stay focused on the issues most important to you when emotions threaten to sink an otherwise sound transaction.

Provide fair and ethical treatment. When you're interviewing agents, ask if they're a REALTOR®, a member of the National Association of REALTORS®. Every member must adhere to the REALTOR® Code of Ethics, which is based on professionalism, serving the interests of clients, and protecting the public. When you work with a REALTOR®, you can expect honest and ethical treatment in all transaction-related matters.

What are questions to ask when considering selling?

These questions will help you decide whether you’re ready for a home that’s larger or in a more desirable location. If you answer yes to most of the questions, you may be ready to move.

Have you built substantial equity in your current home?

Check your annual mortgage statement or call your lender to find out how much you’ve paid down. Usually you don’t build up much equity in the first few years of your mortgage, as monthly payments are mostly interest. But if you’ve owned your home for five or more years, you may have significant, unrealized gains.

Has your income or financial situation changed?

If you’re making more money, you may be able to afford higher mortgage payments and cover the costs of moving. If your income has decreased, you may want to consider downsizing.

Have you outgrown your neighborhood?

The neighborhood you pick for your first home might not be the same one in which you want to settle down for good. You may have realized that you’d like to be closer to your job or live in a better school district.

Are there reasons why you can’t remodel or add on?

Sometimes you can create a bigger home by adding a new room or building up. But if your property isn’t large enough, your municipality doesn’t allow it, or you’re simply not interested in remodeling, then moving to a bigger home may be your best option.

Are you comfortable moving in the current housing market?

If your market is hot, your home may sell quickly and for top dollar, but the home you buy will also be more expensive. If your market is slow, finding a buyer may take longer, but you’ll have more selection and better pricing as you seek your new home. Ask your real estate professional what they see happening locally.

Are interest rates attractive?

Low rates help you buy “more” home, and also make it easier to find a buyer for your current place.

Is the effort and cost of maintaining your current home becoming difficult to manage?

A REALTOR ® can help you decide whether a smaller house, condo, or rental would be appropriate.

How can I add curb appeal?

What is important to clean when preparing a home for sale?

Executing a deep clean before putting your home on the market will not only help it shine, but it will make tidiness easier to maintain between showings. Here are some power-cleaning tips to try.

Clean windows make a huge difference.

Remove window screens and place them outside on a tarp or other clean, waterproof surface. Use a garden hose, an all-purpose cleaner, and a soft brush to gently clean the screens. You don’t need anything special to polish up window glass; just mix a solution of one part white vinegar to eight parts water, plus a drop or two of dishwashing liquid in a spray bottle. Wipe with newspaper to avoid streaks. (Washing on a cloudy day also reduces streaking.)

The fridge is the most common source of kitchen smells.

Check the drip tray underneath your refrigerator and wash out any standing water from defrosting. Scrub the inside of the fridge with a baking soda and water solution. Activated charcoal in the fridge can help keep odors at bay.

Think outside the house.

It’s amazing the difference a sparkling entryway makes to your home’s curb appeal. Wipe down your front door, give the doormat a good shake/vacuum, and make sure dust and dirt haven’t collected on outdoor furniture. Use a pressure washer to give your driveway and garage floor a good cleaning. The acidity in dark cola drinks can help remove oil, rust, and grease stains, along with a little elbow grease.

Target the Bathroom.

For tile floors, apply your usual cleaner and then run a wet/dry vac, which will suck contaminants out of the grout. Pour a quarter cup each of baking soda and vinegar down the drains, leaving the concoction overnight, then flush with boiling water. Clean soap scum and mildew from plastic shower curtains by tossing them into your washer on the gentle cycle in cold water, with detergent and ½ cup vinegar (if mildew is present, add ½ cup of bleach instead of vinegar). Put a couple of large towels into the machine to act as scrubbers. Allow the curtain to drip-dry on the rod.

Make your bed better.

Vacuum mattresses and box springs, and then rotate and flip over. Do the same for removable furniture cushions. This is also a great time to wash or dry-clean the dust ruffle and mattress pad. Add new loft to a lumpy comforter by having two people vigorously shake the quilt up and down to redistribute stuffing.

Wash the walls.

Grease, smoke, and dust can adhere to walls and make even the best decorating look dingy. Resist the temptation to spot-clean since it will make the rest of the wall look dirtier. Mop walls using a general-purpose cleaner diluted with hot water. Start at the top corner of the wall to avoid drips. Don’t press too hard, and rinse the mop head frequently in clean water. Use melamine foam cleaner to erase scuffs and stains.

What are tips to hiring a remodeling contractor?

What are tips to holding a successful garage sale?

Garage sales can be a great way to get rid of clutter and earn a little extra cash before you move. But make sure you plan ahead; they can take on a life of their own.

Don’t wait until the last minute.

Depending on how long you’ve lived in your home and how much stuff you want to sell, planning a garage sale can take a lot of time and energy. And that’s on top of the effort of putting your home on the market!

Contact your local government.

Most municipalities will require you to obtain a permit in order to hold a garage sale. They’re often free or cheap, but the fines for neglecting to obtain one can be hefty.

See if neighbors want to join in.

You can turn your garage sale into a block-wide event and lure more shoppers. However, a permit may be necessary for each home owner, even if it’s a group event.

Schedule the sale.

Sales on Saturdays and Sundays will generate the most traffic, especially if the weather cooperates. Start the sale early — 8 or 9 a.m. is best — and be ready for early birds.

Advertise.

Place an ad in the newspaper, free classified papers, and websites, including the date(s), time, and address of the garage sale. Add information about what will be available, such as kids’ clothes, furniture, or special equipment. On the day of the sale, use balloons and signs with prominent arrows to grab attention.

Price your goods.

Clearly mark rounded prices (50 cents, 3 for $1, or $5, for example) with easily removable stickers.

If it’s junk, recycle or donate it.

If it’s truly garbage, throw it away or place it in a freebie bin. Don’t try to sell broken appliances, and have an electrical outlet nearby in case a customer wants to try plugging something in.

Display items nicely.

Organize by category, and don’t make customers dig through boxes.

Stock up on supplies.

Having a stock of old shopping bags that can be reused encourages people to buy more items. Newspapers are handy for wrapping fragile goods.

Manage your money.

Obtain ample change for your cashbox, and have a calculator on hand. Assign one person to man the “register,” keeping a tally of what was purchased and for how much.

How do I make my home stand out on camera?

How can I incorporate feng shui concepts into staging?

What do I need to know about the appraisal process?

How can I improve the odds of an offer?

Price it right.

Set a price at the lower end of your property’s realistic price range. Consider:

Comparable properties: A “comp” is what real estate professionals call home sales that can be reasonably used to help determine the price of your home. But just because you’re in the same neighborhood doesn’t mean that the houses will sell for the same amount. Your real estate professional will help you determine how to compare your home in terms of size, upkeep, and amenities.
Competition: How many other houses are for sale in your area right now? Are you competing against new homes or condos for sale in the area?
Contingencies: Do you have special needs that might turn away buyers? A common one is refusing to be flexible about a moving date.
Asking a lender: Since most buyers will need a mortgage, the home’s sale price should be in line with a lender’s estimate of its value.
Accuracy: Studies show homes priced more than 3 percent over the correct price take longer to sell.

Prepare for visitors.

Get your house market-ready at least two weeks before you begin showing it. Make all your repairs, and then do a deep clean (or hire a cleaning service to help).

Consider an appraisal.

For a few hundred dollars, a qualified appraiser can give you an estimate of your home’s value. This is useful for sellers going through a divorce or needing to divide the proceeds for other reasons. Be sure to ask for a market-value appraisal, and find someone who understands the area and type of home you have. Your agent should be able to offer recommendations.

Be flexible about showings.

Spur-of-the-moment showings are disruptive, and making sure your home is constantly ready to show can be exhausting. But the more amenable you can be, the sooner you’ll find a buyer.

Anticipate the offers.

Decide in advance the price range and terms that are acceptable. Be clear with yourself and your agent about what kind of offers you’re comfortable with. It’s critical to know what price you’ll accept before entering negotiations with a potential buyer.

Don’t refuse to drop the price.

If your home has been on the market for more than 30 days without an offer, be prepared to at least consider lowering your asking price.

How do I navigate a short sale?

How do I prepare for a short sale?

How can I recognize a qualified buyer?

How do REALTORS® get paid and where does the money come from?

LIBOR HOMEBUYER FAQ

What are the advantages to owning a home?

Why should I work with a REALTOR®?

REALTORS® are members of the National Association of REALTORS® and subscribe to its strict Code of Ethics. When you're buying a home, here's what an agent who's a REALTOR® can do for you.

Act as an expert guide. Buying a home typically requires a variety of forms, reports, disclosures, and other legal and financial documents. A knowledgeable real estate agent will know what's required in your market, helping you avoid delays and costly mistakes. Also, there’s a lot of jargon involved in a real estate transaction; you want to work with a professional who can speak the language.

Offer objective information and opinions. A great real estate agent will guide you through the home search with an unbiased eye, helping you meet your buying objectives while staying within your budget. Agents are also a great source when you have questions about local amenities, utilities, zoning rules, contractors, and more.

Give you expanded search power. You want access to the full range of opportunities. Using a cooperative system called the multiple listing service, your agent can help you evaluate all active listings that meet your criteria, alert you to listings soon to come on the market, and provide data on recent sales. Your agent can also save you time by helping you winnow away properties that are still appearing on public sites but are no longer on the market.

Stand in your corner during negotiations. There are many factors up for discussion in any real estate transaction—from price to repairs to possession date. A real estate professional who’s representing you will look at the transaction from your perspective, helping you negotiate a purchase agreement that meets your needs and allows you to do due diligence before you’re bound to the purchase.

Ensure an up-to-date experience. Most people buy only a few homes in a lifetime, usually with quite a few years between purchases. Even if you’ve bought a home before, laws and regulations change. Real estate practitioners may handle hundreds or thousands of transactions over the course of their career.

Be your rock during emotional moments. A home is so much more than four walls and a roof. And for most buyers, a home is the biggest purchase they’ll ever make. Having a concerned, but objective, third party helps you stay focused on the issues most important to you when emotions threaten to sink an otherwise sound transaction.

How do I prepare for house hunting?

How do I prepare to buy a home?

How do I prepare to finance a home?

Develop a budget.

Instead of telling yourself what you’d like to spend, use receipts to create a budget that reflects your actual habits over the last several months. This approach will better factor in unexpected expenses alongside more predictable costs such as utility bills and groceries. You’ll probably spot some ways to save, whether it’s cutting out that morning trip to Starbucks or eating dinner at home more often.

Reduce debt.

Lenders generally look for a debt load of no more than 36 percent of income. This figure includes your mortgage, which typically ranges between 25 and 28 percent of your net household income. So you need to get monthly payments on the rest of your installment debt—car loans, student loans, and revolving balances on credit cards — down to between 8 and 10 percent of your net monthly income.

Increase your income.

Now’s the time to ask for a raise! If that’s not an option, you may want to consider taking on a second job to get your income at a level high enough to qualify for the home you want.

Save for a down payment.

Designate a certain amount of money each month to put away in your savings account. Although it’s possible to get a mortgage with 5 percent down or less, you can usually get a better rate if you put down a larger percentage of the total purchase. Aim for a 20 percent down payment.

Keep your job.

While you don’t need to be in the same job forever to qualify for a home loan, having a job for less than two years may mean you have to pay a higher interest rate.

Establish a good credit history.

Get a credit card and make payments by the due date. Do the same for all your other bills, too. Pay off entire balances as promptly as possible.

Start saving.

Do you have enough money saved to qualify for a mortgage and cover your down payment? Ideally, you should have 20 percent of the purchase price saved as a down payment. Also, don’t forget to factor in closing costs, which can average between 2 and 7 percent of the home price.

Obtain a copy of your credit report.

Make sure it is accurate and correct any errors immediately. A credit report provides a history of your credit, bad debts, and any late payments.

Decide what kind of mortgage you can afford.

Generally, you want to look for homes valued between two and three times your gross income, but a financing professional can help determine the size of loan for which you’ll qualify. Find out what kind of mortgage (30-year or 15-year? Fixed or adjustable rate?) is best for you. Also, gather the documentation a lender will need to preapprove you for a loan, such as W-2s, pay stub copies, account numbers, and copies of two to four months of bank or credit union statements. Don’t forget property taxes, insurance, maintenance, utilities, and association fees, if applicable.

Seek down payment help.

Check with your state and local government to find out whether you qualify for special mortgage or down payment assistance programs. If you have an IRA account, you can use the money you’ve saved to buy your first home without paying a penalty for early withdrawal.

What do I need to know about credit scores?

How can I improve my credit?

What do I need to know about the appraisal process?

What should be examined during the home inspection?

Some items should always be examined.

Structure

The home’s “skeleton” should be able to stand up to weather, gravity, and the earth that surrounds it. Structural components include items such as the foundation and the framing.

Exterior

The inspector should look at sidewalks, driveways, steps, windows, doors, siding, trim, and surface drainage. They should also examine any attached porches, decks, and balconies.

Roofing

A good inspector will provide very important information about your roof, including its age, roof draining systems, buckled shingles, and loose gutters and downspouts. They should also inform you of the condition of any skylights and chimneys as well as the potential for pooling water.

Plumbing

They should thoroughly examine the water supply and drainage systems, water heating equipment, and fuel storage systems. Drainage pumps and sump pumps also fall under this category. Poor water pressure, banging pipes, rust spots, or corrosion can indicate larger problems.

Electrical

You should be informed of the condition of service entrance wires, service panels, breakers and fuses, and disconnects. Also take note of the number of outlets in each room.

Heating and air conditioning

The home’s vents, flues, and chimneys should be inspected. The inspector should be able to tell you the water heater’s age, its energy rating, and whether the size is adequate for the house. They should also describe and inspect all the central air and through-wall cooling equipment.

Interiors

Your inspector should take a close look at walls, ceilings and floors; steps, stairways, and railings; countertops and cabinets; and garage systems. These areas can reveal leaks, insect damage, rot, construction defects, and more.

Ventilation/insulation

Inspectors should check for adequate insulation and ventilation in the attic and in unfinished areas such as crawl spaces. Insulation should be appropriate for the climate. Without proper ventilation, excess moisture can lead to mold and water damage.

Fireplaces

They’re charming, but fireplaces can be dangerous if they’re not properly installed. Inspectors should examine the vent and flue, and describe solid fuel-burning appliances.

What are some tips to buying in a tight market?

What is a short sale and is it a good idea?

If a home is being sold for less than what the current owner owes on the property—and the seller does not have other funds to make up the difference at closing—the sale is considered a short sale.

A short sale is different from a foreclosure, which is when the seller's lender has taken title of the home and is selling it directly. Home owners often try to accomplish a short sale in order to avoid foreclosure. But a short sale holds many potential pitfalls for buyers. Answering these questions will help you determine if a short sale is a good fit for you.

Are you very patient?

Even after you come to agreement with the seller to buy a short-sale property, the seller’s lender (or lenders, if there is more than one mortgage) still has to approve the sale. When there is only one mortgage, lender approval typically takes about two months. If there is more than one mortgage with different lenders, it can take four months or longer. If you make an offer tremendously lower than the fair market value of the home, the lender could make a counteroffer, which will lengthen the process.

Is your financing in order?

Lenders like cash offers. But even if you can’t pay cash, it’s important to show you’re well qualified. If you're preapproved, have a large down payment, and can close at any time, your offer will be viewed more favorably than that of a buyer whose financing is less secure.

Do you have any contingencies?

Lenders like flexible terms. If you must sell a home before you can close, or you need to be in your new home by a certain time, a short sale may not be for you. Also, you will most likely be asked to take the property “as is.” Lenders are already taking a loss on the property and may not agree to requests for repair credits.

Can you take rejection?

Even when a lender approves a short sale, it could require that the sellers sign a promissory note to repay the deficient amount of the loan, which may not be acceptable to some financially strapped sellers. Lenders also can change any of the terms of the contract that you’ve already negotiated, which may not be agreeable to you.

How should I prepare to proceed with a short sale?

What are questions to ask when considering a condo?

Condominiums, townhomes, and properties located within a homeowner association offer certain perks, but it’s important to consider them in your decision process.

How much storage is available?

Some properties include storage lockers, but there may not be attics or basements to hold extra belongings.

How’s the outdoor space?

Your yard may be smaller than you’d find in a traditional single-family home, so if you like to garden or entertain outdoors, this may not be a good fit. But if you dread yard work, it may be the perfect option.

Are amenities important?

Many properties offer swimming pools, fitness centers, and other facilities that would cost much more in a single-family setting.

Who handles maintenance and security?

Property managers often hire professionals to care for common areas and perform in-unit repairs. Keyed entries and doormen may regulate access to your home when you’re not there (good news if you travel).

Are there required reserve funds and association fees? How much are they?

Although fees generally help pay for amenities and provide savings for future repairs, the HOA or condo board determines these fees, and you’ll have to pay them even if you’re not in favor of the improvements.

What are the association rules?

Although you have a vote on future changes, association rules can dictate how you use your property. Some condos prohibit home-based businesses; others prohibit pets or don’t allow owners to rent out their units. Read the covenants, restrictions, and bylaws carefully before you make an offer.

What’s the average vacancy rate?

It’s never too early to be thinking about resale. The ease of selling your unit may depend on what else is for sale in your building, since units are similar.

How many units are owned by investors?

Some lenders require a certain percentage of the building to be owner-occupied and may not be able to offer you financing if the ratio is too low.

Can I meet other residents before making an offer?

You will share space and decision-making duties with your neighbors when part of a homeowner association, so it’s important to make sure you can work together. If possible, try to meet your closest prospective neighbors before you decide on a place.

What do I need to know about homeowner’s insurance?

A homeowners’ insurance policy protects you against certain losses your new home may experience. Coverage is generally required by lenders prior to closing. Some lenders collect the homeowners’ insurance premium as part of your monthly mortgage payment, place it in an escrow account, and pay the insurer on your behalf.

Coverage exclusions:

There are two types of coverage provided by a homeowners’ policy: 1) Named Peril coverage; and 2) “Open” Peril coverage. Coverage provided on a “Named Peril” basis responds and pays only if the damage is caused by a specifically listed peril (cause of loss) such as fire, wind, or other specifically named causes of loss. Coverage provided on an “Open Peril” basis pays when the damage is NOT caused by a specifically excluded event.

Coverage for damage to your house is most commonly provided on an “Open Peril” basis. However, coverage for your contents (your personal property) is often provided on a “Named Peril” basis. Most insurance policies exclude damage caused by flood or earthquake. You may need to buy these types of coverage separately. If you are in a “high hazard” flood zone, you may be required by the lender to purchase flood insurance.

Dollar limitations on claims:

Even if you are covered for a risk, there may be a limit on how much the insurer will pay. For example, many policies limit the amount paid for stolen jewelry unless items are insured separately.

Replacement cost:

Your home is insured on a replacement cost basis. This means there is no deduction for depreciation due to the home’s age or even condition. But you will never be paid more the amount of coverage you purchased, so be sure your limit is sufficient. However, endorsements exist that allow you to purchase additional coverage after a loss if unexpected events increase the cost of rebuilding.

Actual cash value:

Actual cash value applies depreciation to the insurance carrier’s loss payment calculation. Coverage for your personal property is provided on an actual cash value basis. You also only get actual cash value on your house if it is destroyed and you choose to not have it rebuilt.

Your liability:

Generally, your homeowner’s insurance covers your liability for accidents that happen to other people on your property, including medical care, court costs, and awards by the court. However, there is usually an upper limit to the amount of coverage provided.

How can I lower my homeowner’s insurance cost?

What should I know about title insurance?

Title insurance protects your ownership right to your home, both from fraudulent claims against your ownership and from mistakes made in earlier sales, such as misspellings of a person’s name or an inaccurate description of the property. In some states it is customary for the seller to purchase the policy on your behalf.

Your mortgage lender will require it.

Title insurance protects the lender (and the secondary markets to which they sell loans) from defects in the title to your home—which could include mistakes made in the local property office, forged documents, and claims from unknown parties. It ensures the validity and enforceability of the mortgage document. The amount of the policy is equal to the amount of your mortgage at its inception. The fee is typically a one-time payment rolled into closing costs.

There are two different policies to consider purchasing.

The first policy, the one your lender will require, protects the lenders investment. You may also purchase an owner’s policy that provides coverage up to the purchase price of the home you are buying.

You have the right to choose your provider.

You can shop around for a lower insurance premium rate at a wide variety of sites online. You should first request quotes from a few companies and then reach out and speak to them. Ask about hidden fees and charges that could make one quote seem more attractive than another. Also, find out if you’re eligible for any discounts. Discounts are sometimes available if the home has been bought within only a few years since the last purchase as not as much work is required to check the title. You can also ask your lender or real estate professional for advice or help with getting quotes. Make sure the title insurance company you choose has a favorable Financial Stability Rating with Demotech Inc.

Even new construction needs coverage.

Even if your home is brand-new, the land isn’t. There may be claims to the land or liens that were placed during construction that could negatively impact your title.

How do REALTORS® get paid and where does the money come from?

Expand all

Section 6 FAQs

Q. When do the annual LIBOR Dues bills go out?
Q. Have the Board dues been increased for 2026?
Q. When is the payment due?
Q. If I don’t pay the dues bill by October 3rd, will I pay a pro-rated amount if I renew early next year?
Q. What is LIBOR’s membership year?
Q. How are LIBOR dues structured?
Q. What is the cost of my annual dues?
Q. How can I pay my LIBOR dues invoice?
Q. Will I receive a receipt for tax purposes?
Q. Can I pay my dues in installments?
Q. Is my LIBOR dues payment refundable?
Q. Can I just join my Local or State Association to become a REALTOR®?
Q. What’s the difference between LIBOR and OneKey MLS?
Q. What benefits do LIBOR members receive for their annual dues payment?
Q. Can I receive OneKey® MLS without joining LIBOR?
Q. If I have a question, what is the e-mail address to send it to?
Q. What is the prorated amount for LIBOR dues for new members joining throughout the year?
Q. Does LIBOR receive licensing information directly from the Department of State on an ongoing basis?
Q. Can a Broker hold a license for a part-time licensee without reporting this to LIBOR?
Q. How do I notify LIBOR of these changes?
Q. Can I be a LIBOR member with an expired license?
Q. How will LIBOR know when my license is renewed?
Q. I'm a Broker and my office has moved to a new location. What do I need to do?
Q. How do I notify LIBOR of a name, home address or home telephone number change?
Q. What is the telephone number for the Department of State?
Q. What is the e-mail address for the Department of State?

FAQs

Q. When do the annual LIBOR Dues bills go out?

A. The annual bill is e-mailed in late August to all individuals with a valid e-mail address.

Q. Have the Board dues been increased for 2026?

A. No, the dues are the same as last year.

Q. When is the payment due?

A. Payment for the annual dues is due on October 3, 2025.

Q. If I don’t pay the dues bill by October 3rd, will I pay a pro-rated amount if I renew early next year?

A. . No, dues are not pro-rated if you renew within the same membership year. However, if you are renewing after more than a membership year has passed, prorated dues may apply.

Q. What is LIBOR’s membership year?

A. LIBOR’s membership year runs from October 1 through September 30, while NYSAR and NAR operate on a calendar year, January 1 through December 31.

Q. How are LIBOR dues structured?

A. LIBOR dues are comprised of three components: local dues (LIBOR), state dues through the New York State Association of REALTORS® (NYSAR), and national dues through the National Association of REALTORS® (NAR).

Q. What is the cost of my annual dues?

A. The total cost of your dues is $596. The breakdown is as follows:

Long Island Board of REALTORS® (LIBOR) dues: $275
New York State Association of REALTORS® (NYSAR) dues: $120
National Association of REALTORS® dues: $201($156 plus $45 special assessment)

Q. How can I pay my LIBOR dues invoice?

A. You may pay using any of the following options:

Online: Visit www.lirealtor.com and click Pay My Bill.
Phone: Call 631-661-4800, option #5, to pay with a credit/debit card.
Check: Make check payable to LIBOR and mail to 1305 Walt Whitman Road, Suite 310, Melville NY 11747 Attn: Membership Services.

Q. Will I receive a receipt for tax purposes?

A. Yes. LIBOR will email your receipt at the time of payment to the email address on file. Please refer to your invoice for details on the portion of dues that are non‑deductible due to lobbying and political activities.

Q. Can I pay my dues in installments?

A. Yes, however, installment payments are not available online. To set up an installment plan, please contact the LIBOR Membership Services Team at 631-661-4800, option #5.

Q. Is my LIBOR dues payment refundable?

A. No. REALTOR® membership dues are non‑refundable, even if you leave the association mid‑year. Per LIBOR’s by‑laws, dues across all membership categories are non‑refundable.

Q. Can I just join my Local or State Association to become a REALTOR®?

A. No — REALTOR® membership is a three-way membership structure. When you join your local REALTOR® association, you automatically become a member of New York Association of REALTORS® (NYSAR) and the National Association of REALTORS® (NAR).

This “Three-Way Agreement” is what connects REALTORS® nationwide under one professional standard — the REALTOR® Code of Ethics — and provides shared benefits, advocacy, and resources across all levels of the organization.

Each level plays a unique role in your membership. Together, these three levels form one unified membership — ensuring REALTORS® have a powerful, consistent voice and professional support system across the entire real estate industry.

Q. What’s the difference between LIBOR and OneKey MLS?

A. LIBOR REALTOR® membership and OneKey® MLS access serve different — but complementary — purposes in your real estate career.

LIBOR membership connects you to your state, and national REALTOR® organizations. When you join Long Island Board of REALTORS®, you become part of a professional network dedicated to helping you succeed through education, advocacy, and compliance support.

LIBOR’s mission goes far beyond providing access — it’s about elevating your professionalism and protecting your business.

MLS access, by contrast, is a transaction tool — it lets you list and search properties, share data, and cooperate with other brokers. It supports your day-to-day business, while LIBOR supports your professional growth, compliance, and long-term success.

In short, the MLS helps you conduct business — LIBOR helps you build a better one.

Q. What benefits do LIBOR members receive for their annual dues payment?

A. Your membership at the local, state, and national level provides benefits and services that far exceed the cost of your dues. LIBOR helps you get to, and execute, your next transaction, reduce your risk and liability, promote the REALTOR® brand to consumers, provides exclusive resources and advocate for laws that benefit you and your clients. Members have access to a wide range of benefits, discount programs, and savings opportunities. A full list is available on our website here.

As a member, you also benefit from:

Ethical and professional standards through the REALTOR® Code of Ethics, which builds client trust and industry credibility and sets your apart from nonmembers in the eyes of consumers.
Legal and risk management guidance to help you stay compliant and confident when navigating laws, contracts, and regulations.
Legal Support Center, legal updates and legal tips.
Education, certification, and training programs that keep you current with market trends, fair housing, and best practices.
Advocacy and government affairs that protect your livelihood, defend property rights, and strengthen the real estate profession.
Timely communications and market intelligence that keep you informed and ahead of industry changes.
Local networking and committee opportunities.
Community outreach
Statewide and National community of real estate practitioners.
Expert real estate research and data to help serve clients and consumers with confidence.
Cutting-edge tools, technology and MLS resources that make it easier for you to get to and execute your next transaction.
A national and global network of professionals to build your referral partnerships.
Advanced resources and tools such as Crexi and RPR – the most cutting-edge real estate platform.
Unmatched accreditations and designations to build your credibility and advance your career.
The right to use the REALTOR® trademark.
And Much More!

Membership is an investment in your career, and these services give you the opportunity to grow professionally, stay competitive, and connect with the community.

Q. Can I receive OneKey® MLS without joining LIBOR?

A. Yes. To access OneKey® MLS and the Matrix platform, you must be a Designated REALTOR® Broker in good standing with any REALTOR® Association, or a licensee affiliated with a Designated REALTOR® Broker who participates in OneKey® MLS. Membership in LIBOR is one way to meet this requirement, but you may also join through another REALTOR® Association.

Q. If I have a question, what is the e-mail address to send it to?

A. All inquiries can be emailed to LIBOR Membership at libormem@lirealtor.com.

Q. What is the prorated amount for LIBOR dues for new members joining throughout the year?

A. LIBOR dues are prorated monthly to reflect the portion of the membership year remaining. In addition, each new LIBOR Member Applicant is required to pay a one‑time New Member Processing Fee of $35.00 with their initial dues payment. The prorated schedule is as follows:

EFF DATE OF LICENSE	BALANCE OF 2025 NAR/NYSAR DUES	2026 PRORATEDLIBOR DUES	LIBOR NEW AGENT PROCESSING FEE	TOTAL FEES OWED
Oct 1-31	$114.00	$596.00	$35.00	$745.00
Nov 1-30	$91.00	$573.17	$35.00	$699.17
Dec 1-31	$68.00	$550.33	$35.00	$653.33
Jan 1-31	$0.00	$527.50	$35.00	$562.50
Feb 1-28	$0.00	$481.67	$35.00	$516.67
Mar 1-31	$0.00	$435.83	$35.00	$470.83
Apr 1-30	$0.00	$390.00	$35.00	$425.00
May 1-31	$0.00	$344.17	$35.00	$379.17
Jun 1-30	$0.00	$298.33	$35.00	$333.33
Jul 1-31	$0.00	$252.50	$35.00	$287.50
Aug 1-31	$0.00	$206.67	$35.00	$241.67
Sep 1-30	$0.00	$160.83	$35.00	$195.83

Q. Does LIBOR receive licensing information directly from the Department of State on an ongoing basis?

A. No. LIBOR relies on its members to keep us updated on changes of association, terminations and new licensees. DOS is consulted but does not notify us directly. Designated REALTORS®(Brokers) are required to notify LIBOR of any additions, changes, or terminations of licensees within 10 days of occurrence.

Q. Can a Broker hold a license for a part-time licensee without reporting this to LIBOR?

A. No. All affiliated licensees must be registered with LIBOR.

Q. How do I notify LIBOR of these changes?

A. Terminations: submit to LIBOR a copy of the “Terminate Associations-Summary” confirmation page from the Department of State. Please note: Request Termination-Summary pages are not complete terminations, and we will not be able to remove a licensee until we receive the “Terminate Associations-Summary” confirmation page. There is no fee for this.

Expiration of License: if an affiliated licensee’s license expires and you are not renewing it, we strongly advise that you terminate the license via eAccessNY and send LIBOR the “Terminate Associations-Summary.”

Changes of Association: submit to LIBOR a copy of the “Change Associations-Summary” from the Department of State. Please note the department of state charges a fee for this.

Newly Licensed Agent: submit to LIBOR a completed REALTOR® application and an appropriate dues payment. Membership in LIBOR will be considered a “Provisional Membership” until the applicant has completed the required New Member Orientation Program and the Fairhaven simulation. New Members have 90 days from the date their application has been processed to complete both requirements.

Our REALTOR^® application is available here

Q. Can I be a LIBOR member with an expired license?

A. No. If your real estate license expires, your LIBOR membership will no longer be active, and your MLS access will be suspended until your license is renewed.

Q. How will LIBOR know when my license is renewed?

A. Please e-mail us at libormem@lirealtor.com with your new expiration date. You may also call us at 631-661-4800, voice mail option 5.

Q. I'm a Broker and my office has moved to a new location. What do I need to do?

A. Office address changes must be made on DOS’ eAccessNY site. To do so, please click here to log into your eAccessNY account.

Print out a copy of the confirmation page and email to Debbie Colombo @ dcolombo@lirealtor.com.

Q. How do I notify LIBOR of a name, home address or home telephone number change?

A. You may change your own personal information online at www.lirealtor.com. Click Login then enter your LIBOR Member ID and current password. Click My Account, followed by Go to My Profile. Once there, click Personal Services, then Personal Information. Scroll down to Home Address and make your change. You may also send an e-mail to libormem@lirealtor.com

If you have changed your name on your real estate license, please e-mail libormem@lirealtor.com

Q. What is the telephone number for the Department of State?

Albany - (518) 474-4429
Manhattan – (212) 417-5800

Q. What is the e-mail address for the Department of State?

eAccessNY@dos.ny.gov or licensing@dos.ny.gov

For all other inquiries please contact us at libormem@lirealtor.com.

Section 7

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Phone: (631) 661-4800
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Privacy Policy | Terms of Use | DMCA Notice | Accessibility

1305 Walt Whitman Road, Suite 310, Melville, New York 11747
Phone: (631) 661-4800
© 2023 Long Island Board of Realtors, Inc.
All Rights Reserved.

Web Design & Development by
Matrix Group International, Inc.