Benefits of Co‐op Living
Housing co-ops are a uniquely flexible housing tool, providing many opportunities and benefits to their members, both economic and social.
Economic Benefits
No Closing Costs: When a person buys or sells (transfers) a co-op unit, the person doesn’t receive title to real estate, but instead buys a share of stock in the cooperative corporation that owns the real estate. There is no need for a new title search or title insurance.
Homeowner Tax Advantages: Members of a cooperative can deduct their portion of the cooperative’s mortgage interest and property taxes on their individual tax return.
Equity Security: Because we are a Limited Equity Ownership Cooperative, your investment in your cooperative unit is not exposed to the ups and downs of the housing market. Should you decide to sell your unit in the future, your selling price (“Transfer Value”) includes the Transfer Value you paid, plus any approved capital improvements you made, plus any increase as determined by our Bylaws (Article 9). Many members compare their Transfer Value to a safe investment or savings account that will come back to you when you sell your unit.
Limited Liability: Individual members of the co-op are not personally liable for loans (such as a mortgage) taken out by the cooperative-corporation on behalf of its members.
Operation at Cost: In a cooperative, the monthly carrying charges (MCCs) are based on the cost of owning and operating the property. In a rental, rent exceeds actual costs because the landlord is in business to make a profit.
Overall Value: A cooperative maximizes benefits to its members. A rental maximizes profits to the landlord.
Social Benefits
Self-Management: Cooperative members approve legal documents, determine policies, approve new members, approve the budget and set the priorities for maintenance and improvements.
Community Control: Community concerns as well as individual benefits are taken into consideration in all decisions.
Leadership Development: Serving on a cooperative board, committee, or special task forces provides members with unique opportunities to develop and practice their community leadership skills.
Democratic and Civic Participation: The cooperative living experience is designed to empower members, helping them build life skills and confidence. Studies show that cooperative members are more active in their communities and more likely to vote.
Flexibility to Change Units: As household size or economic status changes, co-op members have the flexibility to change units within their cooperatives. Changing units is called an Internal Transfer undertaken in accordance with bylaw and board approval, and involves transferring share ownership and occupancy agreements.
Enhanced Security: Because co-op members know each other, many feel more secure in their homes.
Opportunities for Strengthening the Social Fabric of the Community: Cooperatives provide natural opportunities for members to form friendships, pursue common interests and, ultimately, strengthen their community.
Lower Rates of Delinquency and Default: Studies reflect that co-ops have lower rates of delinquencies and foreclosure than rental buildings.