|Covered Parking First Right of Refusal||<– Date –> <– Thread –>|
|From: Edwin Simmers (edwinsimmersbellcoho.com)|
|Date: Thu, 11 Mar 2021 15:49:48 -0800 (PST)|
Kelli Soika asks if other cohousings have a mixture of covered and uncovered parking where not every unit has the same garage, covered space or open parking stall. She also asks if there should be a first right of refusal since when an owner leaves someone else may want to upgrade their parking. As other have mentioned, it’s important to know if a unit’s parking situation is “deeded,” that is, legally part of the residential unit and taxed as part by the local real estate property taxing authority. If the parking is legally part of the unit’s deed, it would be expensive and impractical to do anything but transfer the parking as part of the sale when the residence is sold. There are several advantages and some disadvantages to the community as a whole to have deeded parking. But at least the tax value of carports and garages is clearly apportioned to the accompanying unit at tax time and not to the common elements so that everyone shares the tax burden whether they own covered parking or not. The other way of handling parking is for the community to own the parking and rent it out to owners at market rate. This system is certainly more flexible, but comes with the burden of administering it, particularly with decisions like how much to charge and who’s next in line when a space opens up when someone moves out, if that’s what you want. One inevitable issue is finding the money for initial construction of covered parking. Money is usually tight at construction time and folks who don’t want a garage may not have the money to help pay for construction of covered parking, even if they rationally know that as part of the common elements of the community the covered parking will generate a future benefit to the whole community from the income generated. It may be tempting to ask the prospective owners to “buy” covered parking when the parking won’t legally be part of their deeded unit. Experience shows this is the worst combination of the two approaches. People who “buy” something generally think they own it, which to most people means they can do whatever they want for as long as they want. If you’re considering parking that is unequally distributed but need to raise construction funds from the people who will use covered parking, be sure to have a clear written agreement where owners agree that they’re not buying or owning anything; what they’re doing is paying rent (or a license to use) in advance for a right to parking for a certain time and that at the end of that time they may no longer be able to “sell” the use of the covered parking along with the residence. The problem with this approach is that it may well be 8-12 years before the prepaid rent is used up. That leaves owners worried that if they need to sell their unit in the meantime, a prospective buyer won’t want to pay as much for the unit if the covered parking isn’t “deeded.” Be careful: covered parking becomes more and more valuable as the years after construction proceed and who wants their community to have conflict over the many financial issues involved. Good luck! Ed Simmers > Date: Thu, 11 Mar 2021 10:50:02 -0600 > From: Kelli Soika <ksoika [at] gmail.com <mailto:ksoika [at] gmail.com>> > To: cohousing-l [at] cohousing.org <mailto:cohousing-l [at] cohousing.org> > Subject: [C-L]_ Parking > > Hello all, > > Our community is finalizing our allocation of parking options. We have > garages, covered spaces, and surface spaces planned. We're trying to figure > out whether we should consider adding a "first-right-of-refusal" to the > garages and car ports. If we choose this option, an individual who owns a > garage or carport would offer it for sale to the community before selling > it as part of their home sale. > > If there is a community that does this kind of thing, could you reach out? > We asked Katie McCamant if she knew of any off the top of her head and she > did not. > > Thanks! > Kelli Soika > *CoHousing Houston* > Breaking ground 2021
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