FYI There's been some discussion in the cohousing email list recently about whether units in cohousing communities sell at a premium. In USA they don't.
This response left me feeling so grateful to all our "founding members" and gave me such a rush of gratitude for the situation we now find ourselves in as the first owners of Toiora cohousing, that I wanted to share it so everyone could also get the buzz of happiness that comes with reflecting on how lucky we have been with our project. Jan
---------- Forwarded message --------- From: Diana Carroll dianaecarroll@gmail.com Date: Sat, 28 Nov 2020, 5:54 AM Subject: Re: [C-L]_ cohousing premium? To: Dick Margulis dick@dmargulis.com Cc: Cohousing-L cohousing-l@cohousing.org
Appraisals ARE based on selling price. That's what they are: a prediction of selling price. And if you DO list it above appraised value, and you DO get a buyer at the inflated price...they won't be able to get a mortgage, because mortgages are limited by appraised value.
We've had several owners put their homes up for sale. When deciding how much to sell it for, they typically either get it professionally appraised by an appraiser or real estate agent, or do their own informal appraisal by looking at comparables.
If there is a selling premium (such as if an individual buyer is really set on cohousing and this is the only cohousing home for sale in the area), it isn't anywhere *near *$100,000. $10k maybe? But no, I don't really think there is any appreciable difference in price in our area (Central MA).
If you are talking about initial prices for founding members...well, that's a wildly different story and has so many variables, there's no way to give any rule of thumb. It's amazing the price which our founding members (including me) were willing to pay...maybe 30% above equivalent units. But that was because we'd all sunk *soooooo *much money into the project (never mind time, energy, heart, soul and dreams) that we couldn't walk away. The prices were never aimed to be 30% higher, but construction costs grow as happens on pretty much every project ever. We weren't helped by the fact that comparable prices were dropping like crazy because we went "online" in 2008. I paid $525,000 for a unit that was only worth about $300k on the day I bought it, and now is worth only about $400k. It's not happy-making.
Diana (Mosaic Commons)
On Fri, Nov 27, 2020 at 11:40 AM Dick Margulis dick@dmargulis.com wrote:
Diana,
Thanks for your response. I'm sorry that I didn't state my question clearly.
My question is about the difference in selling price, not the difference in appraised value.
In other words, if I see a cohousing unit listed for sale for $600K, would a similar-size conventional condo nearby also be listed for $600K, or would it likely be, say, $500K?
Dick
On 11/27/2020 11:23 AM, Diana Carroll wrote:
No premium. I've worked with zillions of appraisers now and they don't
care
at all. It's all about the square footage and number of bedrooms, and
maybe
a really small premium for having more amenities, but for all the intangible benefits of cohousing? Nada. AND if you add in the fact that most cohousing units are smaller than corresponding conventional units...cohousing is kind of a minus on the appraisal front.
On Fri, Nov 27, 2020 at 10:09 AM Dick Margulis dick@dmargulis.com
wrote:
If you are looking at a cohousing unit and at a comparable
non-cohousing
condo, what is the average premium for the cohousing unit?
Has anyone studied this question and come up with a US average?
Lacking that, if anyone has done this exercise for their own community, would you please comment?
Thanks,
Dick Margulis Rocky Corner Bethany CT
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