Cohousing-L Mailing List: Re: Help!

[Fred H. Olson WB0YQM (fholson]

<I'm posting this due to an address problem on Jim Salem's subscription
(EXA.COM!SALEM) , which I'll fix. Fred>

   Date: Tue, 28 Dec 93 17:31 CST
   From: thud [at] bronze.lcs.mit.edu (Ted Thibodeau Jr)

   People buy in at fair market value of the land/building/whatever
   is being apportioned, regardless of previous buy-in prices.

   Sell-out is done at a fair return over their buy-in price, figured
   on an individual basis.  The "fair return" is based on what they
   might reasonably have received as return on investment had they
   placed their funds in a mutual fund or similar.

   This does cause people who leave the group to lose some capital gains,
   if we look strictly at real estate gains, and those proceed at a rate
   above the securities/bonds/whatever gauge, but they know that at the
   outset, and it is not a severe penalization, given that the prime reason
   for participation in cohousing is not investment income.

On the other hand, over most of the last 100 years, gains from real estate
have lagged the gains from most other forms of investment.  Under this
community's scheme, sellers might receive far more income than if they had
sold their home on the open market.

-- jim