The Definitive Guide to Buying and Selling Washington, D.C. Co-Op Apartments

To many, Washington, D.C’s residential landscape is best known for the charming row homes lining neighborhoods like Dupont Circle and Capitol Hill.

However, much of the city’s charm, style, and old world aesthetic are exemplified in its many co-operative apartment buildings.

From the historic Beaux Arts structures of Kalorama to the mid-century modern Watergate, co-ops comprise some of the city’s most beautiful, historic, and desirable real estate.

An expert in the Washington D.C. co-op landscape, TTR Sotheby’s International Realty Broker Associate Sammy Dweck offers some practical advice for those considering buying or selling a co-op in Washington D.C.

What is a co-op?

1901 Wyoming Avenue NW #3, Washington, D.C. presented by Sammy Dweck of TTR Sotheby’s International Realty

A co-op is short for cooperative housing project.

Though occupying a smaller share of Washington, D.C.’s total housing market than condominiums or apartments, co-ops are distinct in both ownership and financing.

While more predominant in other major cities, such as New York, co-ops make up a relatively small proportion of the residential real estate landscape in Washington, D.C., but comprise an outsized share of its most historic, charming, and valuable real estate inventory.

How are co-ops different from condos?

The ownership structure is the fundamental difference between co-ops and condos.

Condos are considered real estate in the traditional sense, and co-ops are technically shares in a corporation that come with the use of a particular apartment.

This distinct difference in asset classification introduces nuances that can be confusing for the uninitiated, but advantageous for the savvy buyer or seller.

When did co-ops enter the Washington marketplace?

2500 Virginia Ave Nw #1008-S, Washington, D.C. presented by Stan Kelly of TTR Sotheby’s International Realty

Co-ops, which originated in New York in the late 1800s, are typically converted from rental buildings through a process called conversion, whereby the tenants take on collective debt in the form of an underlying mortgage to buy the property from the landlord or owner.

In Washington, D.C., we saw co-ops enter the market in the early 1900s. Although many of the buildings that comprise historic co-ops were built prior to World War I and World War II, these buildings were not necessarily converted to co-ops until years or even decades after their initial construction.

What should you know about buying a co-op?

The path to purchasing a co-op residence is ultimately directed by the co-op board, a group of owners who vet potential residents based on specific set of communal criteria which is only allowed to include financial wherewithal and willingness to follow the building’s rules.

Explore Co-Ops for Sale in Washington D.C. »

While certain co-ops are more stringent than others, ultimately, success in a board interview comes down to a shared understanding of the rules and values of the community and the potential owner’s ability to adequately finance the purchase of the property (as well as the various underlying debts and assessments that come with shared ownership).

Finally, buyers should know that co-ops are intended for owner occupants. Real estate investors are often dismissed as they are only seeking a rental commodity rather than a place to call home. While renting is allowed in most co-ops under specific circumstances, the board ultimately sets the parameters.  

What are some advantages to owning a co-op in Washington, D.C.?

2700 Virginia Avenue NW #502 Washington, D.C. presented by Ron Mangas Jr. of TTR Sotheby’s International Realty

Co-ops offer many advantages to residents and owners.

First, co-ops generally have a lower property tax burden due to the fact that the building assessed as an entity is worth less than the sum of the individual apartments combined. In addition, the D.C. Homestead Exemption, a tax benefit available to homeowners domiciled in the District, may limit the building’s total tax obligation by capping the annual increase.

Second, most co-ops in Washington, D.C. maintain at least an 80% owner to subtenant ratio. For those who value closely controlled and stable communities, this helps ensure temporary residents are few and far between.

Finally, many co-ops in Washington, D.C. often contain exceptional provenance, aesthetic beauty, and cultural significance. While this may not be important to some owners or potential buyers, we are finding these more qualitative features factor in to the larger experience and charm of living in the nation’s capital.

What are some of the financial and technical considerations when buying or selling a co-op?

There are a few important financial and technical considerations for those interested in purchasing a Washington, D.C. co-op.

First, ownership in a co-op is designated as corporate stock, not as real estate. Practically, this means your ownership stake is in the form of corporate shares of an entity which usually owns the building and the land upon which the building rests; not as a deed, as with most real estate.

Ownership shares are determined by the corporation’s governing documents. Typically, there is a nexus between the size of the apartment, and sometimes level location and view, that determine the percentage of the shares assigned to each apartment. These ownership shares are not always necessarily equal to voting shares, but they can be in some buildings.

Next, it’s key to understand fees and corporate debt, including acquisition debt, renovation debt, and underlying mortgages.

As a result of the collective purchasing power former residents levied on ownership to purchase the building, many co-ops engineered underlying mortgages via commercial loans, sometimes with a balloon payment.

Underlying mortgages can vary widely, but typically the lion’s share of a co-op fee is maintenance, operations, and taxes, not the remaining acquisition or renovation debt. As a real estate professional, you should ensure your buyer is aware of the terms of an underlying mortgage, including rate, payment, and whether a balloon payment will come due during your client’s tenure.

A fiscal advantage of co-ops is that owners can often take out 30 year loans to lower the impact of a substantial assessment for capital improvements, rather than making large payments over a shorter 2-3 year window, as is common with condos. You can also write off the interest payments on co-op assessments.

Tax records do not exist for individual co-op apartment units, so important metrics like advertised square footage may be unreliable depending on the source of the information. Where possible, use any official records maintained by the co-op with regard to square footage for developing comparable pricing, and don’t rely heavily on price-per-foot calculations based on potentially unreliable MLS data.

Finally, if you own a co-op you are allowed to leave your shares to an heir, as you would with any asset; however, beneficiaries are often obligated to pass the same board interview as other tenants.

About Sammy Dweck

Sammy Dweck is a Broker Associate with TTR Sotheby’s International Realty. A member of a longtime Washington, D.C. real estate family and a graduate of New York University, Dweck is a specialist in pre-war condominiums and cooperatives. Recently named to REALTOR® Magazine’s “30 Under 30” list, Dweck served on the DCAR Public Policy Committee and is an Ambassador for Safe Shores, a Washington, D.C.-based Children’s Advocacy group.


TTR Sotheby’s International Realty is a licensed real estate brokerage in Washington, D.C., Maryland, and Virginia.


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