Cooperative
A cooperative (co-op) is a type of housing where residents own shares in a corporation that owns the entire building, rather than owning their individual units directly. Shareholders receive a proprietary lease giving them the right to occupy a specific unit and participate in building governance.
Example
“When buying into the cooperative, Sarah purchased 500 shares of the corporation and received a proprietary lease for apartment 4B.”
Memory Tip
Think 'co-op' like a team sport - everyone cooperates by owning shares in the same team (corporation) rather than individual property.
Why It Matters
Co-ops often have lower purchase prices than condos but require board approval for sales and may have stricter financial requirements for buyers. Understanding co-op ownership helps buyers make informed decisions about this unique form of homeownership.
Common Misconception
Many believe co-op owners have the same rights as condo owners, but co-op owners actually own shares in a corporation rather than real estate directly.
In Practice
A buyer purchases 500 shares in a cooperative corporation for $200,000, which entitles them to a proprietary lease for apartment 4B and voting rights in building decisions, but they must get board approval before selling to another buyer.
Etymology
From Latin 'cooperari' meaning 'to work together,' reflecting how residents collectively own and operate their housing community as partners.
Common Misspellings
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