What are the Legal Differences Between a Co-op, Condo, Townhome and House?

When shopping for a residence, a buyer may be attracted to its architectural style,  the lifestyle it offers, privacy, control over of making alterations or maintenance concerns and fees. When considering a cooperative apartment (a “Co-op”), a condominium unit ( a “condo”), a town house or a detached house, it is crucial to understand the pros and cons of each type of legal ownership.  


This is a unit/apartment in a multi-unit building.  The owner owns a particular unit in fee simple and has use of the common areas with other unit owners but only owns a percentage of the common areas in proportion to its ownership interest.  A condo board will govern the business of the condo and approvals may be required to purchase the condo or lease it to a tenant.  Maintenance charges will be shared in proportion to the ownership interest. The Board will set rules and regulations  (“House Rules”) regarding use, alterations and shared areas to maintain community relations. A condo is also governed by sponsor rules when it is newly constructed by the developer and offered for sale through the offering plan.  


A Co-op is  a unit/apartment in a multi-dwelling in which the owner does not own the apartment but has an interest in the entire co-op and holds stock in the corporation and a proprietary lease to the apartment. A purchaser of a co-op will have to interview before the Board and be approved. An owner of a co-op also may have restrictions on leasing the space to a tenant. There may be approval rights on the tenant and the term of the tenant’s lease. Common area maintenance charges will be shared in proportion to the ownership interest.  


This is a unit connected to a similar structure by a shared wall, often called the party wall. Unlike a condo, the townhome owner owns the exterior façade and roof of the structure and must maintain it.  

Each of the above legal structures offers community style living with common amenities such as a pool, gym or clubhouse.


A house is real property that is a dwelling residence (for living purposes not for commercial purposes)  and may be a single family home, a two-family or a multi-family home (3 or more units). It is a freestanding structure and the homeowner owns the structure and the land upon which it sits.  A house offers the most control over its use and privacy then the other legal ownership types described above.  

Other factors to consider when selecting a home with a certain legal structure, are the mortgage type and rates on that particular type of residence, the form of contract of sale and transfer documents will vary, as will the type of title insurance and the home owner’s insurance required.  Ultimately, a purchaser should carefully review the pros and cons of a the legal structure before purchasing a  particular type of home.