Cohousing-L Mailing List: Re: What's Missing in Cohousing? Rentals.

[Kevin Wolf (kjwolf]

At 10:49 AM 2/23/2002 -0500, you wrote:
> How would you pay for them?
> --Diane Simpson
>    Jamaica Plain Cohousing, Boston, Massachusetts

In N Street, 8 of the 17 units are rentals.  Some are owned by members who 
own more than one unit.  Others are owned by absentee landlords.  Some are 
owned by members who moved away and rented their units.  Our common house 
has four rooms that are rented and we are actively planning on putting a 
four room apartment on top.  N Street has this many rentals because the 
houses were bought cheap by owners years ago and now rents more than cover 
expenses.  In new construction, rents will not likely cover costs so 
landlords speculate that their lost monthly income will be made up for by 
increased value of the property over time, and ever increasing rents (plus 
tax benefits such as depreciation).

With the new unit we will be installing on the common house, some of our 
members are willing to invest their money with a limited return so that the 
new unit can become a limited equity rental whereby the "owners" gain the 
tax benefits and a set return on their investment (probably 7%).  Because 
the unit is being added to the common house, we don't have to pay for the 
land costs and the rents will almost immediately pay for all 
expenses.  Then rents go up 3% per year.  This will cover maintenance and 
other cost increases and eventually will create a positive cash flow for 
the community, which is the master lease holder.  (The community will have 
a triple net lease with the owners of the rental unit. In this arrangement, 
the community pays all expensese including taxes, maintenance, insurance, 
mortgate etc.  At the end of 30 years, the community pays $1 to the owners 
and takes over the deed. )

Our community is also encouraging owner occupants to build "granny flat" 
apartments on their homes to create more rental units.  The granny flat 
option makes it easier for two community tenants to buy a single family 
house and make it into two units on the same lot and thus make it more 
affordable for both to be able to become home owners.   In CA, one of the 
units in a granny flat must be owner occupied.

Kevin
****************
Kevin Wolf
N Street Cohousing Community member
724 N St, Davis, CA  95616
530-758-4211
kjwolf [at] dcn.davis.ca.us

To download my facilitation manual or other material on
consensus decision making, visit http://www.dcn.davis.ca.us/go/kjwolf

_______________________________________________
Cohousing-L mailing list
Cohousing-L [at] cohousing.org  Unsubscribe  and other info:
http://www.communityforum.net/mailman/listinfo/cohousing-l