You don’t need 10 years in the business to make an impact this spring, coach Darryl Davis writes. You need 10 moves — done with consistency, creativity and a willingness to learn as you go.
Now more than ever, real estate needs inspirational innovators like you. Nominations for the 28th annual Inman Innovator Awards are still live, but not for long! You’ve got until May 16 to get your name in the hat for a chance to be known as one of the industry’s top innovators.
Care by Upfront is a nationwide health benefits program that can be white-labeled by brokerages on behalf of their agents.
When you are hunting for an apartment in New York City, you may come across a listing for a condop, particularly if you are searching for sponsor co-ops. Condops are probably one of the most misunderstood types of NYC apartments, and while brokers often describe them as co-ops with condo rules, in reality, they are a little more complicated.
Here’s a more specific description: Condops are mixed-use co-op buildings with commercial or non-residential space on the ground floor. As a result, they will have multiple boards that separately govern the residential and commercial parts of the building.
Why NYC has condops
During the wave of co-op conversions in the 1980s, owners and developers were faced with a tax rule that capped earnings for co-op buildings from non-residential or commercial spaces at 20 percent of their income. If the amount went over 20 percent, the shareholders couldn’t take advantage of certain homeowner tax deductions.
To fix that, owners and developers divided their buildings. The commercial space was designated as one condo unit, while the entire residential section was considered another and was divided into co-operative shares. And so the condop was born.
[Editor’s note: This article was previously published in June 2023. We are presenting it again with updated information for May 2025.]
Basically, condops allowed for the creation of co-ops while giving the sponsor the ability to own or rent the commercial spaces in the building with all the freedoms of condo-style ownership. Their unique structure makes them complex, typically consisting of three boards.
First is a condominium board, made up of representatives from both the residential co-op units and the commercial space. This board handles issues related to the building’s general common elements, such as exterior repairs or major plumbing upgrades.
The second is a commercial board, which governs issues for the commercial units.
The third board is elected by the co-op members and deals with shareholder issues for residents’ shared spaces, including common hallways or laundry rooms.
| What to know about buying or selling a condop in NYC | |
|---|---|
| Multiple boards add complexity |
|
| Buyers should do their due diligence |
|
| Financing and selling concerns |
|
What you need to know before buying a condop
Condops often have substantial and very profitable commercial spaces. As a result, disagreements often develop between the two distinct entities involved in condop governance, e.g., the residents and the owners of the commercial space, said Dean Roberts, a real estate attorney at Norris McLaughlin.
For example, the representatives of the ground-floor commercial space might resist having to pay for elevators they never use.
Then there’s the issue of board representation. In one of Roberts’ recent condop cases, the building was evenly split between a school dormitory and a private residential space.
“On the board, the school had three votes, while the residents had two. That means you’re pretty much at the mercy of the school,” he said.
Roberts advised any prospective condop buyer to find out how well the boards function and whether they’ve been involved in any litigation, namely by asking the managing agent for intel and searching the building’s financial statements for clues.
It is also important to determine if they are allocating expenses properly. Is something a condo expense, a co-op expense, or a commercial expense? There can be gray areas as to which entity is responsible for different capital improvements.
Real estate attorney Adam Stone, a partner at The Stone Law Firm, advised reviewing both the co-op and condo financial statements to find out what percentage of the condo’s common charges is assigned to the co-op and whether the condo is up to date on its financial contributions.
Pro Tip
Pro Tip:
If you’re not seeing enough homes for sale in your price range or target neighborhood—and/or you’d like to avoid a bidding war—consider expanding your search to “off-market” listings. NYC real estate brokerage The Agency, a Brick Underground partner, uses technology to mine public records and identify owners who may be ready to sell, meaning you can meet and deal with owners before their homes hit the market. Click here to learn more.
Who is the right buyer for a condop?
The initial question is whether you can be comfortable with the unique arrangement of condops and be willing to live in a mixed-use building.
Sometimes, a condop can make it easier to become an owner. Abra Nicolle Nowitz, a broker at Corcoran, pointed to a retired couple who was looking for a one bedroom in NYC and fell short of the post-closing liquidity required of a co-op. She said a condop in Midtown East offered the flexibility they needed. The couple also planned to use money from their IRA for their down payment.
“It was the price point they were looking for and the financial package that would work for them,” Nowitz said
Know, too, that you’re unlikely to see many new condop buildings because co-ops generally trade for less than condos, by about 15 percent, so developers are reluctant to go this route. Mixed-use condo buildings are more common, although Brooklyn Point is an example of a recent development that’s designated as a condop and built on leased rather than owned land. (Read more about the ins and outs of buying in a land-leased building.)
Sponsored
The Agency’s Off-Market Advantage
Discover off-market properties in your dream neighborhood that perfectly suit your needs and budget. Meet and deal with sellers before their apartment hits the market.
Let The Agency’s off-market team give you exclusive access to apartments in your price range and desired neighborhood that no one else has seen. More options, less competition, no bidding wars.
How to find a condop
Most of NYC’s major broker firms and listing sites don’t have a filter for you to search for (or screen out) a condop. You can, however, do a keyword search for “condop” on Streeteasy, which turned up 87 apartments, the bulk of which were in Manhattan.
Otherwise, buyers typically come across a condop listing while looking for co-ops or condos and reading the fine print.
How to finance or sell a condop
Lenders treat condops like co-ops, said Keith Furer, a mortgage banker at GuardHill Financial. That means a bank will require a slightly bigger down payment than it would for a condo.
“Lenders will want to look at both the co-op part and condo part financials, along with all the other standard documentation that they look at when underwriting a project. Pretty much a similar type of underwriting scrutiny if just a co-op or a condo,” Furer said.
Even so, it’s important to work with a lender who understands what a condop is. Furer said most out-of-state lenders and loan officers don’t even understand what a co-op is. “I can’t imagine the majority of them have ever even heard of a condop or have any clue what it is,” he said.
If you are selling a condop, you should be prepared to answer a lot of buyer questions. Specifically, that means providing information about how the boards operate.
Although brokers often say condops have more liberal policies, they can be every bit as tough on sublets and sales as any stand-alone co-op. Your due diligence will be important because every building is unique.
—Earlier versions of this article contained reporting and writing by Marjorie Cohen and Emily Myers.
You Might Also Like
Iantorno is a top luxury agent in San Diego, with more than $1 billion in sales over a 20-year career. Compass’s office exclusives, among other tools, were a big draw, he told Inman exclusively.
Michael Mercurio, the former CEO of the Greater San Diego Association of Realtors and San Diego MLS, alleges wrongful termination as a separate suit against him is set to go to trial in October.
HomeQuest Realty has returned to Keller Williams after seven years away from the Texas-based franchisor. The firm, which closed $91.9 million in 2024 sales volume, will now operate as Curtis Realty Group.
The team did $180 million in sales volume via 90 transactions last year. Its move to Coldwell Banker comes amid an intense period for agent and team recruiting.
The average closing costs for a refinance mortgage in the U.S. totaled $2,403 last year, or about 0.72% of the loan amount, according to a new report from LodeStar Software Solutions.
The findings mark the company’s first analysis of refinance-specific closing costs. Closing fees ranged widely by location and are influenced largely by state and local taxes.
New York topped the list with closing costs averaging 2.1% of the loan amount — nearly three times the national average. Average costs in the state came in at $6,565.
Washington, D.C., recorded the highest average closing cost of $6,773, albeit with a lower percentage of the average loan amount (1.19%).
In contrast, California, Utah and Maine recorded the lowest percentages at 0.33%, 0.40% and 0.44%, respectively. Total closing costs in California averaged $1,746, with Utah at $1,933 and Maine at $1,424.
Missouri ($1,196) reported the lowest average closing costs of any state, totaling 0.45% of the average loan amount.
The study found that jurisdictions without mortgage, recording or intangible taxes tend to have lower closing costs. Those with these taxes — such as Washington, D.C., New York, Florida, Maryland and Pennsylvania — had some of the highest costs.
“The effect of recordation taxes and fees on the total closing costs as a percentage of the refinance loan amount is notable,” said Ron Carvalho, director of data operations at LodeStar.
“Texas, which has no transfer taxes but holds the sixth highest total closing cost as a percentage of refinance loan amount, is an outlier. Virginia and New Jersey, which both have transfer taxes, hold eighth and ninth places, respectively.
A 10% reduction in title insurance premiums — a key component of typical closing costs — was recently ordered by the Texas Department of Insurance (TDI), with the regulator citing profit ratios that were deemed to be excessive. The mandate is set to go into effect July 1.
“Hawaii, in seventh place, does have transfer tax, but that tax is seller paid and only on deeds,” Carvalho added. “The amount in that state is surprisingly high in this case, since there are no mortgage taxes due for refinances.”
Nationally, the average refinance loan amount in 2024 was $339,579, with a median of $327,124. Median closing costs — including taxes and recording fees — totaled $2,056. When excluding these taxes and fees, the median amount was $1,802.
Homebuyers paid an average of $4,661 in closing costs for purchase mortgages last year, according to LodeStar data released in April.
Bill Pulte, the director of the Federal Housing Finance Agency (FHFA) and chair of the boards at Fannie Mae and Freddie Mac, said in an interview on Tuesday that a handful of employees at the government-sponsored enterprises (GSEs) who are from U.S. geopolitical foes China and North Korea have been referred to the U.S. Department of Justice (DOJ).
Pulte was interviewed by Bloomberg TV at The Milken Institute Global Conference. He was asked about the ongoing effort to privatize the GSEs before speaking about what he has seen at the agencies that has caused him concern.
Among these elements, Pulte suggested that people from China and North Korea were embedded at the GSEs, posing as contractors or other staffers.
“We’ve heard, for instance, [and] recently criminally referred some North Koreans and Chinese for working inside of Fannie Mae and Freddie Mac,” Pulte said in the interview. “I mean, what are the Chinese and the North Koreans doing in these companies?”
He added that his oversight efforts increasingly involve scrutiny of contracts at the FHFA, as well as the “bureaucracy” between the GSEs and the U.S. housing system. But Bloomberg reporter Sonali Basak returned to the topic of foreign nationals working inside the GSEs themselves.
Federal Housing Finance Agency Director Bill Pulte says he is focusing on making Fannie Mae and Freddie Mac operationally efficient during an interview with @sonalibasak at the Milken Institute Global Conference in Beverly Hills, California https://t.co/EVEc0g5HvJ pic.twitter.com/ESSLnwDf00
— Bloomberg TV (@BloombergTV) May 6, 2025
“When you said that there were Chinese and North Koreans working for the agency, do you mean non-U.S. citizens?” she asked. Pulte said that was correct.
“There were non-citizens working who were posing as either real Americans, or in some cases contractors,” Pulte said. “And we also recently uncovered some other things where some of the Indians were also working inside of the companies as well.”
This could be a reference to recent staff cuts at Fannie Mae, where roughly 100 employees were fired for unethical conduct stemming from a matching grants program.
Pulte added that there was “more to come on that,” before jumping back into the topic of North Korean and Chinese nationals.
“I think we’ve referred five or six different people to the DOJ, just in terms of North Koreans and Chinese working in the companies,” he said.
China and the U.S. are currently locked in a trade war tied to tariffs initially imposed by the U.S. on Chinese imports, although economic dialogue has been ongoing and the trade relationship between the countries is well documented.
The U.S. has long had an acrimonious relationship with North Korea, stemming from the 1953 armistice that ended the Korean War and established a demilitarized zone to separate it from South Korea, an economic and military ally of the U.S.
The DOJ has not announced any criminal indictments related to Pulte’s statements.
JKDS is a licensed New York State real estate brokerage firm. #10351200205