Yes, you can buy an apartment, but it works differently than buying a house

You can purchase an apartment, and many people do. When you buy an apartment, you own the individual unit itself — the walls, fixtures, and everything inside. You do not own the land or the building structure. Instead, you own a share of the common property (hallways, roof, parking areas, lobby) along with every other unit owner, usually through a legal structure called a condominium or cooperative.

The main difference between buying an apartment and renting one is that you build equity with each mortgage payment instead of paying a landlord. You also take on maintenance costs, property taxes, and insurance. The trade-off is stability — you control the space, can renovate within limits, and are not subject to rent increases or lease non-renewals.

Buying an apartment requires a down payment (typically 3 to 20 percent of the purchase price), a mortgage, proof of income, and a credit check. You will also pay closing costs, which usually run 2 to 5 percent of the purchase price. The process takes 30 to 45 days from offer to closing.

Key Takeaways

  • Buying an apartment means owning your unit but sharing ownership of common areas with other residents through a condo or co-op structure.
  • You will need a down payment, mortgage approval, and proof of income; the process typically takes 30 to 45 days from accepted offer to closing.
  • Monthly costs include a mortgage payment, property taxes, homeowners insurance, and a mandatory building fee (HOA or co-op maintenance charge) that covers shared spaces.
  • Condominiums give you more freedom to renovate and sell; cooperatives are cheaper to buy but restrict your ability to sell and require board approval for changes.
  • Before making an offer, review the building's financial statements and reserve fund to understand whether special assessments are likely.

Condominiums versus cooperatives: which structure you are buying into

The two main ways to own an apartment are as a condominium or as a cooperative. In a condominium, you own your unit outright and hold a mortgage on it like a house. You pay property taxes on your unit, carry homeowners insurance, and pay a monthly homeowners association (HOA) fee to cover maintenance of common areas. You can sell your unit whenever you want, and a buyer can get a traditional mortgage to purchase it from you.

In a cooperative, you do not own the unit directly. Instead, you own shares in the corporation that owns the entire building. You have a proprietary lease that gives you the right to occupy your unit, but you do not hold a mortgage on the unit itself — you borrow money to buy the shares. The cooperative charges a monthly maintenance fee that covers property taxes, insurance, and building upkeep. Selling a co-op unit is slower because the building's board must approve the buyer, and many lenders are reluctant to finance co-op purchases, which limits your pool of potential buyers.

Condominiums are more common in most of the country and easier to buy and sell. Cooperatives are prevalent in New York City and a few other cities, and they tend to be cheaper to buy upfront but harder to exit. Ask your real estate agent which structure is standard in your area and which one fits your timeline and financial situation.

What you need to may have access to for an apartment mortgage

Buying an apartment requires the same mortgage process as buying a house. Lenders will ask for proof of income (usually two years of tax returns and recent pay stubs), a credit report, and a list of your debts and assets. Most lenders want a credit score of at least 620, though 740 or higher gets you better interest rates. You will also need to show that your total monthly debt payments (including the new mortgage) do not exceed 43 percent of your gross monthly income.

The down payment ranges from 3 to 20 percent of the purchase price, depending on the loan type and your financial profile. A Federal Housing Administration (FHA) loan allows 3.5 percent down but requires mortgage insurance. A conventional loan typically requires 5 to 20 percent down. Some lenders offer first-time buyer programs with lower down payments or reduced closing costs — ask your lender what programs you might be may be able to access for.

Lenders also review the building itself. They will order an appraisal to confirm the unit is worth what you are paying, and they may request the building's financial statements, reserve fund information, and details about any ongoing lawsuits or special assessments. If the building is in poor financial condition or has too many units in foreclosure, the lender may refuse to finance purchases there.

Monthly costs beyond the mortgage payment

When you own an apartment, your monthly housing cost includes more than just the mortgage. You pay property taxes (which vary widely by location), homeowners insurance (required by your lender), and a building fee — called an HOA fee in a condo or a maintenance charge in a co-op. This building fee covers the cost of maintaining common areas, paying building staff, property insurance for the structure, and setting aside money for future repairs.

Building fees vary dramatically depending on the building's age, location, and amenities. A newer building with a doorman, gym, and pool will have a much higher fee than an older building with minimal services. In some markets, the building fee can be as much as the mortgage payment itself. Before you make an offer, ask the seller or listing agent for the current building fee and review the building's financial statements to see whether the fee is likely to increase significantly in the next few years.

You are also responsible for repairs inside your unit — appliances, plumbing, flooring — and the building is responsible for the structure, roof, and common areas. Some buildings require you to carry additional insurance called a loss assessment policy to protect you if the building needs a major repair and the reserve fund is not large enough to cover it.

How to evaluate a building before you buy

Before you make an offer on an apartment, request the building's financial statements, reserve study, and minutes from recent board meetings. The financial statements show whether the building is operating at a surplus or deficit. The reserve study estimates how much money the building needs to set aside for future repairs like roof replacement or facade work. If the reserve is less than 50 percent funded, special assessments (unexpected bills to residents) are more likely.

Check whether the building has any pending lawsuits, code violations, or major repairs in progress. Ask your real estate agent or the building management how many units are owner-occupied versus rented out — buildings with too many rentals may have trouble getting financing or may be in decline. Also ask whether the building has had any special assessments in the past five years and how much they cost.

Walk through the building at different times of day. Look at the lobby, hallways, and common areas. Talk to current residents if you can — they will tell you whether the building is well-maintained and whether the board is responsive. A cheap building fee in a poorly maintained building is not a bargain.

The closing process and what happens after you buy

Once your offer is accepted, you have a set period (usually 10 to 21 days) to conduct inspections and review documents. Hire a home inspector to examine the unit and building systems. Review the condo or co-op documents, which spell out your rights and responsibilities as an owner. These documents are lengthy and dense — consider paying a real estate attorney to review them, especially if you are buying a co-op.

Your lender will order an appraisal and title search. You will lock in your interest rate, usually within 30 days of the offer. A few days before closing, you will receive a Closing Disclosure document that lists all the costs you will pay at closing, including the down payment, loan origination fees, title insurance, appraisal, inspection, and attorney fees. Review this carefully and ask questions about anything you do not understand.

At closing, you will sign the mortgage note and deed of trust (or mortgage, depending on your state), transfer funds for the down payment and closing costs, and receive the keys. After closing, you become responsible for property taxes, insurance, and the building fee. You will receive notice of the next board meeting and can attend if you wish.

Frequently Asked Questions

Can you get a mortgage for an apartment in a co-op building?

Yes, but it is harder. Most lenders will finance a co-op purchase, but they require a larger down payment (often 25 to 30 percent) and charge a higher interest rate because co-op shares are considered riskier. Some lenders will not finance co-ops at all. Ask your lender upfront whether they finance co-ops in your area before you fall in love with a unit.

What happens if the building needs a major repair and the reserve fund is empty?

The building can charge owners a special assessment — a one-time bill split among all units. This can be thousands of dollars. That is why reviewing the reserve study and financial statements before you buy is critical. A loss assessment insurance policy can protect you, but it does not cover the full cost.

Can you renovate an apartment you own?

In a condo, you can renovate your unit as long as you follow building rules and get any required permits. In a co-op, the board must approve renovations, and approval can be slow or denied. Check the building documents to understand what renovations are allowed before you buy.

Do you pay property taxes on an apartment you own?

Yes, in a condo you pay property taxes on your unit. In a co-op, you do not pay property taxes directly — the cooperative pays them and includes the cost in your maintenance charge. However, you can deduct your share of the building's property taxes on your federal income tax return if you itemize.

How long does it take to sell an apartment after you buy one?

In a condo, the timeline is similar to selling a house — typically 30 to 90 days on the market depending on price and location. In a co-op, the process is slower because the board must approve the buyer, and many buyers struggle to get financing. Plan for three to six months to sell a co-op unit.