What is Cooperative Housing?
As defined by the dictionary.
Cooperative: "1. Working together: working or acting together with others, or done by people working or acting together in a cooperative effort; 2. of jointly owned apartment building: relating to a building with apartments owned by a corporation of tenants in which shares of expenses are calculated on the basis of the value of the tenant’s apartment."
Cooperative housing means joint ownership and operation of a housing development by those who live in it. Cooperative members are in effect their own landlords, enabling the cooperative community to be built and operated at a very affordable cost. Each member purchases a share in the corporation. These shares provide the equity to secure a mortgage. These individual shareholding members have equal voting status in electing the cooperative board of directors from their membership. Cooperative housing combines the advantages and pride of home ownership with the conveniences of community living.
Woodbridge Cooperative of New Hope offers maintenance-free living, security, social life, and a role in community affairs. Woodbridge is a resident-owned community.
The Basics:
Ownership: The building and land is owned by a cooperative corporation. The stock in that corporation is owned by residents ("members") prorated in value to the size of their homes.
The stock may be sold This practice is referred to as "limited equity", and experience is that as units become more and more affordable over time, the waiting list builds thereby assuring timely resale. Members have occupancy rights to a specific home as long as they own their stock, make their monthly charges, and are healthy enough to not be a hazard to themselves or other residents. Default in monthly charges can trigger a forced sale of their membership.
Monthly charges pay for operating expenses and real estate taxes. Real estate taxes are paid comparable to single-family homes; state "Homestead" exemption, if any, often applies.
Prices and monthly charges are significantly less expensive than assisted living and continuing care retirement communities ("CCRCs"). Cooperatives do not include extensive personal or home-care services, except at the option of individual residents.
Age minimum: Under the law, 80% of the homes must be occupied by households with one member 55 and older.
Mortgage interest and real estate taxes are deductible from state and federal income tax.
A management company may or may not be retained. Some co-ops self-manage.
Members elect a board of directors which makes all policy decisions for the cooperative. Operating policies are set out in by-laws, including such things as pet policies, permission for members to rent their homes, etc. These by-laws can be amended by the membership.
What does it cost to purchase a Membership in Woodbridge Cooperative of New Hope?
There are two primary costs involved. The first is the cost of the "share" in the corporation. That is the actual cost of the unit you select. The cost of the "share" is based on the square feet of the unit and any upgrades included at the time of construction. Members also pay a monthly fee, which include real estate taxes, operating expenses, reserves, common area and exterior maintenance, sewer, water, trash pick-up, and recycling. The monthly fee also covers liability insurance for the building, legal and accounting services, and professional management. Monthly fees are based on the square feet of your unit.
Share costs and monthly fees vary depending on the size of the floor plans. As in the case of traditional home ownership, members are responsible for their own phone and electricity. The interest expense and real estate taxes associated with your home are tax deductible.
What are the tax benefits of a cooperative?
The benefits are identical to those you enjoy in your single-family home. The real estate taxes and mortgage interest associated with your new home are fully tax deductible.
How do I make a reservation at Woodbridge of New Hope?
Each reservation requires a $500 deposit. If you change your mind for any reason, your reservation deposit is refundable.
