When you list your home on the MLS, you have to state what type of ownership you have. This post will explain the two main types of ownership and will also provide detailed definitions for additional, less common types of ownership. Read on to learn more!
The two most common types of real estate ownership are "Condominium" and "Fee Simple". Here are the specific definitions for each:
The seller owns the interior of a unit but shares an ownership interest in the land and common areas with other owners in the building.
- Fee Simple:
This is a fancy way of saying the seller owns the entire home and the land beneath it. Most homes are "fee simple" ownerships.
If you live in a condo building when you list your property on the MLS, you should choose "Condominium". If you own a freestanding house, you should choose "Fee Simple".
Now that you understand the difference between the two most common types of ownership, let's take a look at a few definitions for additional real estate ownership types.
Additional Types of Ownership
A cooperative (or "co-op") is a multi-unit building where each resident owns an interest in the building. Unlike a condo unit, the resident does not own the unit they occupy, rather they lease the unit from the cooperative. Owners in a co-op are often referred to as "shareholders".
- Land Lease:
Residents pay rent for the ground upon which the home stands, instead of owning the land outright. Land leases are rare.
PUD stands for Planned Unit Development and describes a housing development that is not subject to standard zoning requirements for the area. With permission from the local government, a developer has established new guidelines for the building and common areas. These may include street lighting designs, street width standards, architectural styles, building height standards, land coverage ratios, common area park or amenity requirements.
- Right to Use:
The seller is selling the right to use a property, not to own it. Some timeshares, for example, are a "right to use" ownership.
Have questions about various ownership types? Ask us!