Re: rental policy in these economic times
From: Holly McNutt (
Date: Mon, 31 Jan 2011 15:08:21 -0800 (PST)
Hello Lisa and greetings from Nyland in CO,

Wow, that's a tough one.  I'm a home-owner here as well as being a realtor and 
property manager. We have 42 homes here and many (at least 12) have a rental 
unit, like a basement apartment. There are only a few houses that are all 
rental, and only one is that way because it is a short-term rental while on the 
market.  So we have maybe 10% non-owner occupied.  
While we have a few long-term renters, it is true that the majority of tenants 
will come and go at a faster rate than owners, and this does create more 
turn-over in the community.  There is a learning curve for new folks and a 
period of adjustment, but there is also wonderful new energy that comes with 
the newbies as they fall in love with the community and want to contribute.  
That doesn't apply to everyone, of course, but some of my best friends here are 
tenants and I hope they will stay forever!  If they had to own to live here, 
they would not be able to afford it.  We like to have some socio-economic 
diversity here, so having rentals does make it possible for a broader income 
range to be here.  

I don't think Nyland has a specific limit on the number of rentals, or if it 
does it hasn't come up in the 3 years I have been here.  I know we have more 
renters now than the original creators of the community planned on, but we do 
not have any rules and regs about this.  As far as I know, owners can occupy or 
rent at their discretion.  Then again, Nyland doesn't have too many hard and 
fast rules about anything, which is both a blessing and a curse!

In terms of financing, that is a big and valid issue.  Banks are so picky now 
and they do look at the percentage of owner-oc versus rented units, but I think 
you need to have at least 20% rentals before they will even bat an eye. Every 
HOA has some rentals.  Coho communities probably have fewer than average. Bank 
policies vary on that percentage, so I don't think I can give you a set number 
that you should not exceed.  But it is a legit concern to anyone wanting to buy 
in or refi.  

The part about your community having a two-year max for tenants is scary to me. 
 We have one tenants who is an angel who has been here over a decade.  If she 
had had to leave after 2 years, what a loss that would have been for everyone!  
We have many others who have been here a lot longer than two years. I wonder if 
that policy could be changed.  For one thing, anyone signing up to rent KNOWS 
in advance that they can't stay too long and I would think that would hugely 
influence their involvement level and desire to connect deeply.  

I think a key piece is that landlords need to take responsibility in finding 
tenants who are a good fit for the community.  It's not always easy to judge 
that up front, but certainly something to encourage.  

I have more thoughts on this, but that's the most important stuff.  Good luck 
with this challenging issue.

- Holly
On Jan 31, 2011, at 3:27 PM, Lisa Lackey wrote:

> Hello cohousing-L-
> I am writing from Nevada City cohousing, where we are discussing changing
> our rental policy because of the economic down turn, and I am wondering if
> there are any other communities that are also making changes or have
> recently created one.
> We created a rental agreement which made total sense in the economic climate
> we were in at the time.  The goal is to have long term residents, which
> seemed to equate to homeowners.  Because we understood that situations come
> up where someone might need to rent temporarily, we allowed for up to 5
> units out of 34 (15%) to be rented at a time, and the rental could only
> extend for 2 years.  If the owner wanted to extend the rental for longer,
> they needed to make a proposal to the Board.  The idea was to be able to
> share the privilege to rent to everyone who wanted or needed to.  If someone
> wanted to leave the community, then they should sell.
> But, that was at a time when selling was fairly easy.  Now buyers are so
> sparse, that it takes a while for the right person to come along.  People
> can't afford to have their home sit vacant, and it is not helpful for the
> community to have vacant homes.  Additionally, many young families with
> children simply can't afford to buy these homes.  They would like to become
> long term residents, but can only afford to rent.  However, the way our
> policy is structured, they can only stay for 2 years without being asked to
> move. if there are other households that would like to rent (& there are).
> Some members of our community would like to up the number of rentals
> possible and encourage the renters to become long term residents.  There is
> some controversy as to how that might affect owners from getting mortgages
> (our legal structure is a condominium, where the percentage of rentals
> affects the ability to obtain mortgages).  People also worry how that will
> affect community structure and resident commitment to maintaining the common
> facilities.  Some people feel the rental percentage should stay at the 15%
> level its now, others feel it should go to 20%, others think 30% would be
> ideal and others think we should get rid of the limit and focus on
> encouraging long term residence.
> Is anyone else dealing with their rental policy now?
> Thanks so much for all your help,
> Lisa
> _________________________________________________________________
> Cohousing-L mailing list -- Unsubscribe, archives and other info at: 

Results generated by Tiger Technologies Web hosting using MHonArc.