Minnesota has many senior housing cooperatives, and many people moving out of a longtime home end up choosing between a co-op and a condo. They can look alike from the hallway. The way you own them, pay for them and sell them is quite different.
What you actually own
In a condominium, you own your unit as real estate, plus a shared interest in the common areas. You get a deed, you pay your own property taxes, and an owners' association manages the building.
In a cooperative, a corporation owns the whole building. You buy a share (sometimes called a membership) in that corporation, which gives you the right to live in a specific unit. Members elect a board that runs the co-op, and the board usually approves new members.
What you pay each month
Both come with a monthly payment, but it covers different things.
- Condo association dues typically cover common-area upkeep, building insurance, reserves and some utilities. Your mortgage and property taxes are separate bills.
- Co-op monthly fees typically cover your share of the building's mortgage (if it has one), property taxes, insurance, maintenance, reserves and often some utilities. It tends to be one larger bill that covers more.
When you compare the two, add up everything you'd pay each month, not only the dues or the fee.
| Senior cooperative | Condominium | |
|---|---|---|
| You own | A share in the corporation that owns the building | Your unit as real estate, plus shared common areas |
| Upfront cost | Share price (often lower than a comparable condo) | Purchase price |
| Monthly cost | One fee that usually includes taxes and the building's mortgage | Association dues, plus your own taxes and any mortgage |
| Financing | Share loans are available from fewer lenders; many buyers pay cash | Conventional mortgages are widely available |
| Age | Usually limited to residents 55 or 62 and older | Some are 55+; many have no age limit |
| Getting in | Waitlists are common; board approval is typical | Buy when a unit is for sale |
| Selling | Follows the co-op's rules; some cap how much a share can gain in value | Sold on the open market |
Equity: how much your share can grow
Senior co-ops in Minnesota come in different equity models. In a market-rate co-op, share prices rise and fall with demand, much like a condo. In a limited-equity co-op, the bylaws cap how much a share can increase in value each year, which keeps entry costs lower for the next member but limits what you'll get back when you sell. Always ask which model a co-op uses, and read the bylaws before you buy.
Who each option tends to suit
- A co-op often suits you if you want community and shared activities, a predictable all-in monthly cost, a lower upfront price, and you plan to stay for many years.
- A condo often suits you if you want to leave more value to heirs, need conventional financing, want the freedom to rent the unit out later, or prefer fewer rules about resale.
Questions to ask before you choose
- What does the monthly fee or dues include, and how much has it gone up in recent years?
- How healthy are the reserves, and are any special assessments planned?
- For a co-op: market-rate or limited-equity? How does resale work, and how long are units usually on the market?
- How long is the waitlist, and what does it cost to get on it?
- What happens if my health changes? Are services available on site or nearby?
Tax treatment of co-op fees and share loans can differ from condo ownership. Ask your tax professional how it applies to you. To browse co-ops and see current vacancies, visit the Minnesota Senior Cooperative Directory, or explore the senior cooperative library.
Talk it through with Lisa
Lisa helps Twin Cities families buy into and sell out of senior cooperatives, and she publishes SeniorCooperatives.com. If you're weighing a co-op against a condo, Book a free call and bring your questions.