Re: Home price for cohousing, over price of surrounding comparable houses
From: Odysseus Levy (odysseuscosmosgame.org)
Date: Thu, 17 Nov 2005 09:20:57 -0800 (PST)
Yes it is very true that being a coop limits our financing options. I personally made it a board project to investigate whether it made sense to switch to a condo model. But in the last few years we've been consistently getting very good rates from National Coop Bank, so it has not recently been a practical issues. For example, I recently moved between units and I temporarily needed a loan for two units until I sold the old one. I was able to get a low interest ARM from NCB with almost no downpayment requirements.

I don't think it is the coop model that accounts for the price differential.

Actually when I reread the original question I realize I answered the wrong question :-). I think they are talking about what price diffential they might expect for a newly built community where they are taking all the development risks. It seems reasonable to assume in that case that the units will later sell for at least a 15% premium especially if you include the common house. I wasn't a member of Winslow Cohousing at that time, but from the stories I hear, one big goal was affordability and there was even some limited sweat equity so it is quite likely that the prices were under market value at the time -- you were there Chris, do you remember?

One thing that I've found in our pricing was that buyers had a very hard time factoring in the value of our shared land and facilities.

By the way, I am not trying to imply that there is a problem. In just about every way Winslow cohousing has been a huge success, and people love living here. I was just trying to help with the nuts and bolts of financing.


Chris ScottHanson wrote:

It must be noted that Winslow Cohousing is one of very few cohousing projects legally owned and operated as a cooperative in this country. Therefore, the market is severely impacted by limited financing options, high down payment requirements, etc. In the past, some members at Winslow have considered whether to convert the project to the condominium ownership structure as a result.

Chris - who once lived there but now lives down the street.

On Nov 16, 2005, at 4:26 PM, Odysseus Levy wrote:

Our recent experience at Winslow Cohousing has been the opposite. Of the last four sales, all owners had to come down from their initial asking price, and sometimes substantially. This was during a very hot sellers market. In particular, people who put a lot of upgrades into their unit did not get anything close to receiving all of that money back at the time of sale. So it seems like we are seeing at least a 10 to 15% discount against the going price.

That said, Bainbridge Island, like most places in Seattle, has seen a tremendous rise in prices. The type of person who wants to live in cohousing is typically quite different from the yuppie who is willing to pay top dollar to snap up that condo. So this price differential is not necessity bad (in fact in some important ways it is actually good), but it does seem to be real.


Becky Weaver wrote:

Hi all,
My group (Central Austin Cohousing) has been working under an assumption that the initial price (i.e. not resale price) of a cohousing home will be about 10 - 15% higher than the price for a comparable (same square footage & construction quality) home nearby. In other words, we have been assuming that the price for the common facilities and other cohousing-specific costs average 10 - 15% per home.
My question is, what was that ratio for your community?
My goal is to get a handle on we should expect, and what we should aim for, in terms of development costs/home prices. Thanks,
Becky
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