There are three types of buildings you can rent an apartment in New York City: rental buildings, cooperatives (co-ops) and condominiums. Each of these property types has its own set of rules and regulations. Understanding the distinction between them will be important as it will influence rental preferences.RENTAL BUILDINGS
Definition: The entire building is owned by a landlord (either a person or corporation) and all of the apartments are available for lease. Residential apartments in New York City are either “rent-regulated (i.e. rent stabilized” or they are not. According to the New York City Rent Guidelines Board, there are approximately 1 million rent stabilized apartments in New York City. A rent stabilized building is subject to guidelines for yearly rent increases. Rent stabilization was established in the late 1960s in response to the critical housing shortages and low vacancy rates in New York City. Rent stabilization sets limits on the amount by which owners can raise the rent for renewals of existing leases or vacant apartments. The guidelines for yearly increases are set by the Rent Guidelines Board in June and become effective every October. Non-stabilized rental apartments are not subject to any specific rent guidelines. The rent is based on a supply and demand. Lease terms on these units are established by the landlord’s specifications and requirements.COOPERATIVE BUILDINGS
Definition: A housing cooperative (also known at a co-op) is a building which is owned by a corporation comprised of the tenant-shareholders of the building. Each tenant-shareholder owns a percentage of shares in the corporation allocated to his or her apartment, but does not own the apartment itself. The number of shares generally depends on the apartment size and the floor on which the apartment is located. The tenant-shareholder has the right to occupy the apartment as his or her home by holding a proprietary lease to that apartment. If you choose to rent a co-op, you are subletting from a tenant-shareholder, who in turn becomes your landlord. Rental prices are generally unregulated and are established by supply and demand. Co-op shareholders and their tenants are subject to rules and regulations set forth in the By-Laws of the corporation. Shareholders in a co-op must get permission from the Co-op Board of Directors to rent their apartment. When permission is granted, the lease is subject to any restrictions or qualifications placed on subleasing by the Co-op Board of Directors.CONDOMINIUMS
Definition: Condominiums are multi-unit dwellings with privately owned residences and shared common areas. Condominiums are classified as real property, meaning that buyers own the deeds to their dwellings. You, the tenant, lease the apartment directly from the condo owner. Rental prices are also generally unregulated and are established by supply and demand.