Condo (own) vs Co-op (rent)

[Aloysius_Poutine]

OK stashers, here's my dilemma.

We own an apartment style condo, but just found out we got into a co-op townhouse we applied for last year. Our condo is spacious and currently meets our needs well, but it's in a "bad" part of town with crappy schools, and has no yard. We have a 1 year old baby and would love the yard that comes with the co-op. We also have friends in the co-op complex, and it's in a better neighborhood with better schools. Housing is expensive in this region - about $500k for an average post war bungalow in an average neighborhood. We'd love to buy a single family home, but that's out of our reach for at least 5 more years.

CONDO:
Paid $206,000 3 years ago. Worth about $190,000ish now with $170k remaining on the mortgage.
Mortgage - $750/mo
Condo fees (includes heat/water)- $300/mo
Property tax - $90/mo
Condo bylaws restrict us from keeping this place and renting it out.

CO-OP
$2000 share purchase to buy-in
$850/mo plus uilities (no extra prop tax payments)
Similar size - 2 bedroom, with the option to move to a 3 bedroom unit later if needed. Also the yard!

Conventional wisdom seems to dictate that we should keep the condo - "build equity, blah blah bah" - but the co-op will be quite a bit cheaper on a monthly basis, and we can throw the remaining equity cash into investments.

What else should I be thinking of?

[jfer_rose]

Hmmm, interesting. I'm guessing maybe co-ops work differently in Canada than in the US? I live in a co-op in the US, but mine works a lot more like a condo than what you describe. For example, I had to take out a mortgage for a similar price as if I had bought a condo, and I am building equity in that I can sell my co-op down the line.

[Aloysius_Poutine]

Yes, it's quite a bit different than the type of co-ops I've heard of in NYC, for example. Here you pay a nominal buy-in fee and then make monthly 'rent' payments. When you leave you sell the shares to whomever takes your place. It's basically just like renting, but you are a joint owner of the whole complex. There is no opportunity to take advantage of capital appreciation.

[GuitarStv]

Where are you looking?  Around here in Toronto, the co-ops that I've seen are filled with poor people and seem kind of sketchy.  (Read - a little scary at night.)

Depending on the area, and how long you plan to stay, the no appreciation/depreciation aspect could either help of hurt you.

[Aloysius_Poutine]

The area is metro Victoria, BC. Our condo is in Esquimalt-- arguably the sketchiest/poorest municipality in the region. The co-op is in Saanich-- a thoroughly middle class suburb. The co-op is in a much nicer area, but will add about 5km to my commute (not a big deal). We plan to stay in either place for about 5 years before buying a house.