Re: Membership sale agreement questions
From: Rob Sandelin (
Date: Tue, 19 Apr 94 16:13 CDT
Jim_Snyder-Grant wrote an extensive piece on the New View's legal agreements.

Thanks for the details, they are very helpful.  I would also add that 
some groups are doing mixed ownership models of both Co-op and Condo. 
For example, Sharingwood where I live has the houses as condo ownership 
(9 acres) and the greenbelt is owned as a cooperative (31acres). I 
understand that a group in California has set up their property 
ownership so the market rate housing is condo, and the 
lower-income/subsidized housing is co-op, which allows them to set 
equity levels on resale to maintain the low-income.  (The low income 
housing is subsidized through a local government program)

At Sharingwood the cost of each condo "lot" paid for  the cost of the 
total property so the banks indirectly supported the coop by financing 
members lot purchase.  (we got our property at a pretty good price) 
Since the lot prices were within the appraised value norm it allowed us 
to fund the greenbelt.  We will also do something similiar for lot 
costs in our second phase, only the funds will be used to subsidize our 
common development and possibly a couple of units which will be owned 
by the cooperative corporation and leased.  In this way the value of 
the lots in the future development will essentially give us a free 
commonhouse, shop and maybe even a unit or two.

In essence, we are overcharging "ourselves" for lot costs and since the 
banks are financing us, the amount that is extra is paying for common 
development in a cooperative. The land was bought and held by the 
cooperative corporation and the condominium bought from the cooperative 
so we bought the condominium units from ourselves at a price greater 
than we paid for them to cover development costs.  Our lawyer was 
impressed, said it totally legit and thought it was a nifty way to get 
indirect bank financing of something the bank would not really ever be 
willing to finance.  Since we are a non-profit and used all the money 
to cover common development we didn't even owe any taxes.

The key thing for us was the ability to buy the land, subdivide it and 
develop it at a lower than market cost. Typically a developer does this 
and pockets the profit. We used, and will use,  the profit to fund the 

Sharingwood Cohousing

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