What is a Certificate of Occupancy?

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At some point in your New York real estate life you will come across the term C of O or better known as Certificate of Occupancy. This little piece of paper holds a lot of clout in buying, selling, getting a mortgage or fighting a legal battle.

Summed up in one sentence "A Certificate of Occupancy (CO) states a building’s legal use and/or type of permitted occupancy." This document can change over time based on zoning or when the physical construction of a building changes. Is this building residential, commercial, or manufacturing? Is it a 2 unit or a 5 unit? The building must comply with the legal C of O or the city can interfere and issue fines to the owner. According to the Department of Buildings "No one may legally occupy a building until the Department has issued a Certificate of Occupancy or Temporary Certificate of Occupancy."


If you are looking to buy in a new development condo during the construction phase, it is very likely the building does not currently have a Certificate of Occupancy or a Temporary Certificate of Occupancy. As a buyer you cannot finalize a mortgage, close or take possession until the DOB issues the condo this precious document. This could often take months or possibly years. 

"The Department issues a final Certificate of Occupancy when the completed work matches the submitted plans for new buildings or major alterations. It issues a Letter of Completion for minor alterations to properties. These documents confirm the work complies with all applicable laws, all paperwork has been completed, all fees owed to the Department have been paid, all relevant violations have been resolved and all necessary approvals have been received from other City Agencies."

Renters should also concerned about the C of O on their building. It is not uncommon for a landlord to try and make alterations with out complying with the city regulations because of financial reasons or perhaps just laziness. This often occurs if someone tries to squeeze a basement apartment in for extra income or split up a unit to increase the rent roll. If you are living in a building with out a legal C of O, the Department of Buildings could theoretically issue a vacate order at any time. 

Many first time homeowners dream of buying a older brownstone in Brooklyn and find out before closing there are major changes needed to comply with to close the transaction. Make sure to speak with your attorney, contractor and real estate agent before jumping into a fixer upper. Once you are aware of these laws in New York, it is usually pretty easy to spot a non compliant building.  

If you have any questions about this subject or your home, please feel free to contact me today. 

- Marcus Amadeus Schott

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