Can You Purchase Co-op Shares If You Don't Plan on Living in the Unit?

May 19, 2015 — Say you live in a rent-stabilized apartment, but you want to make an investment. Can you purchase share of a co-op elsewhere — with the intention of renovating and flipping it — without ticking off the landlord? That's the question Ronda Kaysen fields in this week's Ask Real Estate column in The New York Times. "Can the owner of the rent-stabilized apartment start eviction proceedings against me? Separately, am I permitted to own the co-op unit without actually living in it?" he asks. Kaysen explains that it's perfectly acceptable for tenants of rent-stabilized apartments to own property elsewhere — as long as that rent-stabilized unit is the primary residence. "Where you run into trouble is if you live in that second home for more than half the year," Kaysen explains. It should be no problem for this particular potential investor, since he has no intention of living in the co-op unit he's interested in purchasing. The actual pickle, of course, is that co-op boards tend to require shareholders to live in the units they purchase; that is, the purchased unit has to be the primary residence. "A board would not be likely to allow a purchase by a buyer who did not plan to live in the building," says Kaysen. So what's a guy to do? Try investing in a condo instead. Condo rules are typically more flexible.