A condominium, or condo for short, is a form of housing tenure. It is the legal term used in the United States and in most provinces of Canada for a type of joint ownership of real property in which portions of the property are commonly owned and other portions are individually owned. In Australia and the Canadian province of British Columbia, the legal term for this is known as strata title. In Quebec, it is known as syndicates of co-ownership. Colloquially, the term "condo" is often used to refer to the apartment unit itself in place of the term "apartment". This clearly signifies ownership of the property. The closest equivalent in the United Kingdom is shared freehold.
Discussion
Often, a condominium consists of units in a multi-unit dwelling (i.e., an apartment or a development) where each unit is individually owned and the common areas like hallways and recreational facilities are jointly owned by all the unit owners in the building. It is possible, however, for condominiums to consist of single family dwellings: so-called "detached condominiums" where homeowners do not maintain the exteriors of the dwellings, yards, etc. or "site condominiums" where the owner has more control over the exterior appearance. These structures are preferred by some planned neighborhoods and gated communities.
A homeowners association, consisting of all the members, manages the common areas usually through a board of directors elected by the members. The same concept exists under different names depending on the jurisdiction, such as "unit title", "sectional title", "commonhold," "strata council," or "tenant-owner's association", "body corporate", "Owners Corporation" or "condominium association." Another variation of this concept is the "time share". Condominiums may be found in both civil law and common law legal systems as it is purely a creation of statute.
The rules for condominium government or management are established in a document commonly called a declaration of condominium. The owners and occupiers of condominiums are subject to rules in the declaration of condominium or created by the condominium association, such as paying required monthly fees for maintaining the property's common areas. Condominiums are commonly owned in fee simple title, but can be owned in ways other real estate can be owned, such as title held in trust. Owners can typically rent their condominiums to other people to occupy as tenants, similar to renting out other real estate.
Non-residential condominiums
Condominium ownership is also used, albeit less frequently, for non-residential land uses like offices, hotel rooms, retail shops, and group housing facilities like retirement homes or dormitories. The legal structure is the same, and many of the benefits are similar; for instance, a nonprofit corporation may face a lower tax liability in an office condominium than in an office rented from a taxable, for-profit company. However, the frequent turnover of commercial land uses in particular can make the inflexibility of condominium arrangements problematic.
United States
An alternative form of ownership, popular in the United States but found also in other common law jurisdictions, is the "cooperative" corporation, also known as "company share" or "co-op", in which the building has an associated legal company and ownership of shares gives the right to a lease for residence of a unit. Another form is leasehold or ground rent in which a single landlord retains ownership of the land on which the building is constructed in which the lease renews in perpetuity or over a very long term such as in a civil law emphyteutic lease. Another form of civil law joint property ownership is undivided co-ownership where the owners own a percentage of the entire property but have exclusive possession of a specific part of the property and joint possession of other parts of the property; distinguished from joint tenancy with right of survivorship or a tenancy in common of common law.
The first condominium law passed in the United States was passed by the Commonwealth of Puerto Rico in 1958. Common law tradition holds that real property ownership must involve land, whereas the French civil law tradition recognized condominium ownership as early as the 1804 Napoleonic Code; thus, it is notable that condominiums evolved in the United States via a Caribbean government with a hybrid common-civil legal system. Section 234 of the 1961 National Housing Act allowed the Federal Housing Administration to insure mortgages on condominiums, which led to a vast increase in the capital available for condominiums and to condominium laws in every state by 1969. Americans' first taste of condominium life came not from its largest cities but from south Florida, where developers had first imported the condominium concept from Puerto Rico and used it to sell thousands of inexpensive apartments to retirees arriving with equity earned from the urban North.
