Cohousing-L Mailing List: Re: Cohesiveness of community after a sale?

[Ken Winter (kenatsun]

Another class of "wrong" buyers you'll want to filter out are real estate
investors: people and companies that buy homes just to rent them out for a
while and then sell them when the market is right.  These people couldn't
care less about attracting community-minded people; they'll just rent and
eventually sell the home to whoever will give them the most profit.

A variant of this investor problem is when an existing owner decides to
make some money off their house by renting out all or part of it on the
open market.  This is a situation that is harder to balance.

On the upside, renting all or part of a coho home has many benefits:  It
can make living in cohousing more affordable, for both owners and renters.
By opening up otherwise unoccupied housing, it can help ease homelessness
caused by the society-wide affordable housing shortage.  And, at least here
at Sunward Cohousing, some of our renters have been among our most
permanent and community-minded members.

But on the downside, one of our owners decided to monetize his unit by
turning it into an AirBnB, which led to a series of transients, disruptive
partying, and of course no addition of real members to the community.  We
had no policy within our governing agreements to stop him from doing that.
We were able to get rid of the AirBnB only because we discovered that the
zoning of our property forbids such usage, so we could invoke the local
authorities to enforce that restriction on him.  When a community has to
invoke outside authorities to settle internal conflicts, that's a failure
of the community's self-governance.

This episode sparked an initiative to develop a rental policy to encourage
the good and discourage the bad.  After two years, we came up with and
agreed to a policy whose core is this set of restrictions:

   1.

   Restrictions:  Rentals must comply with the following restrictions.
   However, co-owners may request, in writing, that the Board of Directors
   or their designee make exceptions to these restrictions.
   1.

      Short-term rentals are prohibited.
      2.

      A unit may not be rented to more than two different tenants during
      any 12-month period.
      3.

      Owner-absent rentals are permitted only after the owner has resided
      in the unit for one year or more.
      4.

      The number of non-owner-occupied Sunward units that may be rented as
      owner-absent rentals at any one time shall not exceed ten
percent (10%) of
      the total number of units in the condominium, that is, shall not exceed
      four (4) Units.

We intend these rules to make our community an unattractive investment for
external speculators and to make it nearly impossible for owners to turn
their houses into hotels.  Click here
<https://docs.google.com/document/d/1aL18AvyLDAOa7lMg0t5mH06-y-NGJJro1RetF38nVcs/edit?usp=sharing>
to view the entire agreement.

~ Ken Winter
~ Sunward Cohousing, Ann Arbor, MI


---------- Forwarded message ---------
From: R Philip Dowds via Cohousing-L <cohousing-l [at] cohousing.org>
Date: Sun, Jul 20, 2025 at 8:53 AM
Subject: Re: [C-L]_ Cohesiveness of community after a sale?
To: Cohousing-L <cohousing-l [at] cohousing.org>
Cc: R Philip Dowds <rphilipdowds [at] me.com>


Great question(s).  At Cornerstone Cohousing, we’re still working on this
(we’ll probably always be working on this), and don’t pretend to have all
the answers.  But I’ll share some of our experience and thinking to date:

      (1) We have ROFR built into our master deed from the year 2000.  The
idea is that (a) Cornerstone can insist that sellers present the
association with a (partially redacted) purchase and sale offer, and then
(b) Cornerstone can “take over” this offer by transferring it to some other
buyer we “like better”.  Cornerstone itself never buys or owns a unit, even
transitionally.  But historically, we've NEVER USED ROFR.  First, we tend
to feel it’s intrusive on the “private” transaction of a valued friend and
neighbor who wants to sell; and second, we worry about stumbling on some
prohibition of fair housing law.  Meanwhile, we’re told that ROFR inteferes
with reverse mortgages, which potentially allow some of our older members
to afford staying at Cornerstone after they retire.  So:  We are currently
looking at removing ROFR from our master deed.

      (2) Many communities seem to maintain a successful and useful waiting
list.  On the other hand, cohousing units do not turn over with the same
regularity as do “ordinary” HOA units, so maintaining a viable and relevant
waiting list can be a lot of work, and in the end, irrelevant.  My personal
view is that if you want a relevant “waiting list”, you should try to
invest it with more value.  This could mean (a) insist on an annual
registration fee ($50???); (b) consistently invite waiting list members to
your community events (e.g., special meals, lectures, game day, whatever);
and (c) encourage list members to show up for work contributions, like a
spring yard clean-up.

      (3) The association “approves” a buyer?  ???  I’ll hasten past all
the ins and outs of fair housing law, but if you engage in “approving” one
buyer over another, you may inviting a discrimination law suit.
Personally, I’d stay far away from anything that looks like the association
“approving” one  candidate, and “rejecting” another.

So: What do we do at Cornerstone?  We confess that we’ve heavily and
shamelessly plagiarized from Ann Zabaldo at Takoma Village — and we’ve
established a “marketing team” that “helps” all of our willing sellers to
sell their units.  Some of the activities of this team include …
Helping to advertise availability.
Helping to “show” the unit.
Meeting with candidate buyers.
Explaining participation expectations.  More specifically, emphasing that
sustaining relatively low monthly dues is supported when community
“members” invest time in management and chores.
Explaining social expectations.  More specifically, emphasizing that we
value household-to-household reciprocity of helping out.  And getting to
know (and respect) the backstories everyone brings with them.
Helping candidates find the professionals — vendor sources — that can
assist with the burdens of moving, and setting up a new residence.
… And so on.  All of which, (1) attracts households with communitarian
instincts.  And (2), scares off households without.  We are NOT real estate
attorneys or real estate brokers, and we don’t imply that we are.  But
sometimes or often our “help” is substantial, and grateful sellers may make
a voluntary cash contribution (typically four figures, but one time, five)
back to Cornerstone.

———————————
Thanks,
Philip Dowds
Cornerstone Cohousing
Cambridge, MA

> On Jul 19, 2025, at 2:55 PM, Christine Cook Mania <
christine.d.cook [at] gmail.com> wrote:
>
> We're forming a new cohousing community and we are thinking about how to
> maintain the cohesiveness of the community when someone sells their unit.
> We want to ensure the new buyer is committed to being an active
participant
> of the community and would like some review of the prospective buyer
before
> the sale is completed. We have come up with three different options:
>
>   1. One of the ideas we are considering is for our community to have the
>   "right of first refusal" to buy the unit. For any community that does
>   establish a "right of first refusal" on the sale of a unit, what do you
do
>   to actually exercise it?
>   2. Another way is to maintain a waiting list of qualified buyers.
>   3. And another way is to add something to our by-laws requiring the
>   approval of the "condo association" of the buyer.
>
> We are curious to know what existing communities are doing?
>
> Warmly,
> Christine
>
>
> ___________________________________
> Christine Cook Mania, MA, RYT-200
> Check out my new book, *Vegan Minded: Becoming a Steward for Animals,
> People, and the Planet <https://amzn.to/3LCD47t>.*
> Learn more about my work at christinecookmania.com.
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