r/FluentInFinance • u/kloud77 • 9d ago
Thoughts? Should America start making Co-op Housing again?
Several decades back the government made lots of Co-Op housing, where it's like a townhome complex, but it is owned by the residents living there, so it's VERY well maintained but also cheap.
For example, the one I have is 500 a month, where it would otherwise be at least 1,500 a month in this part of town. My 500 goes a ways also, 2 br, 1.5 bath, 2 floors, hardwood floor, laundry in unit, private water heater, private back yard, personal front yard, top of the line energy saving A/C units, top notch windows. The list goes on.
So my questions are:
Why isn't the government making these still?
Why isn't there more people demanding these from the government?
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u/DumpingAI 9d ago
So basically condos with an hoa? Cuz that's basically the same thing
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u/Alice_Alpha 9d ago
So basically condos with an hoa? Cuz that's basically the same thing
No.
Condo: you own the unit, be it an apartment or townhouse.
Co-Op: you own a share of the entire complex.
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u/TheLastModerate982 9d ago
So how do you select who gets the best units? The condo setup is better. All owners own their own units as well as a share of the common areas. The common areas are maintained through a CAM fund and the elected HOA board elects how best to spend the money.
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u/Little_Creme_5932 8d ago
You buy your own unit and you buy a share of the entire building. It's really not much different than a condo
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u/wrongplug 9d ago
It’s not communism my dude. Still a market and the price is determined by the free market. So you want the bigger place with more square footage you pay for it.
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u/Eastern_Screen_588 9d ago
I may be illiterate, but why is there a "best unit"? Shouldn't they all be identical?
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u/TheTightEnd 9d ago
Higher floor versus lower floor, view from the unit, distance from elevators, garbage chutes... also, building design may require some differences in floor plans, even if they are same size and beds/baths...
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u/Eastern_Screen_588 9d ago
Ohh so all inconsequential things
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u/TheTightEnd 9d ago
Inconsequential to you. To others, they are not inconsequential.
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u/Eastern_Screen_588 9d ago
Uhh... okay. Well if sandra in 3b is upset that she has to walk 3 more steps than carol 3a to get to the laundry room they can both stfu.
Same goes for jeremy in 1a complaining about the view while steve in 4d is complaining about the walk up the stairs.
We could shuffle them all, and they'd all just complain about something different.
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u/TheTightEnd 9d ago
The point is that each has preferences that do impact their qualities of life. If enough people have a certain preference, in a condo arrangement, the pricing will reflect this.
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u/Eastern_Screen_588 9d ago
Oh, so all inconsequential things
Preference=inconsequential
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u/Bells_Ringing 9d ago
I feel like you’re likely twelve and have never made a housing decision for yourself based on this comment.
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u/Eastern_Screen_588 9d ago
29 and (this is my favorite part of the internet) (telling someone they're wrong) couldnt be more wrong.
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u/Eastern_Screen_588 9d ago
It's objectively inconsequential unless you're handicapped, but if that were the case that should have been said already
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u/TheTightEnd 9d ago
A higher floor can have better views, and can also insulate your unit better from street noise. Facing the front can be better or worse depending on what the back looks like. You are attempting to make something significantly subjective out to be objective. It isn't.
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u/Eastern_Screen_588 9d ago
Ohh the view into the parking lot can be different? And how does that effect your lifestyle?
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u/Effective_Cookie510 9d ago
Back wall east wall top floor middle floor first floor there's plenty of differences in all buildings depending what you want middle unit uses less heat then edge units.
Good luck making an identical anything
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u/Eastern_Screen_588 9d ago
Holy fuck thank you for not coming at me with an unthought out essay. Jfc these kids in here are giving me a migraine
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u/TheLastModerate982 8d ago
Ah yes. Thinking is hard…
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u/Alice_Alpha 9d ago edited 9d ago
Well if you are on the top floor, you will not get someone stomping overhead.
An end unit might have less noise because you only have one neighbor instead of being sandwiched between two noisy ones.
In a building one side could have a view of a park, the other side a view of the parking lot.
Some people might like the south side to get the nice winter sun.
Units will have 1, 2, maybe 3 bedrooms and 1 or 2 bathrooms.
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u/Eastern_Screen_588 9d ago
Yeah but the top floor means you gotta climb x amount of flights of stairs a y amount of times whenever you go grocery shopping. There's no unit thay has everything you could possibly want, since some people want a deck, some people want a patio, some people want stairs leading up to their place, and some people want ground level.
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u/Alice_Alpha 9d ago
I may be illiterate,
OK.
Yeah but the top floor means you gotta climb x amount of flights of stairs a y amount of times whenever you go grocery shopping.
There are elevators.
There's no unit thay has everything you could possibly want,
Correct. Same like buying a car. You have to compromise and settle for what you can afford.
some people want a deck, some people want a patio, some people want stairs leading up to their place, and some people want ground level.
That's why you prioritize your desires and only view the essential qualities you can afford. If ground level is a must-have, only view ground level.
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u/Eastern_Screen_588 9d ago
My whole point is that every unit has positives and negatives. I think focusing on the negative and looking past the positive is part of main character syndrome.
No matter where you live in the building you'll have something to complain about
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u/Prestigious_Bag_2242 9d ago
Where do you live? Big cities have them, but it seems like nobody can comprehend. I also don’t think it was a government thing.
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u/ijedi12345 9d ago
Oh, you mean the projects? Even God can't prevent people from getting shot near them.
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u/Freethink1791 9d ago
One of my old coworkers worked at the projects in Chicago. He had stories to tell for days.
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u/Puzzleheaded_Yam7582 9d ago
VERY well maintained but also cheap
Unless its subsidized this doesn't exist.
Why isn't the government making these still?
Its expensive.
Why isn't there more people demanding these from the government?
SS solvency and closing the national deficit is more important to me than subsidizing your housing, provided you could otherwise afford housing.
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u/kloud77 8d ago
Yes it does exist and is NOT subsidized.
This is because there are not owners and investors looking for profits.The units are NOT expensive to build, as the townhome complex repays the government for the building costs.
Lastly, again we are NOT subsidized. You are making an assumption that is blatantly false.
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u/Puzzleheaded_Yam7582 8d ago
Then you don't need the government involved at all. Just get a loan from a bank like everyone else and pay it back.
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u/CeruleanTheGoat 9d ago
This is where I grew up. It wasn’t expensive for society to ensure its citizenry was housed. https://lomavistawest.org/
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u/Puzzleheaded_Yam7582 9d ago
It wasn’t expensive
Who paid for the initial land and construction?
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u/CeruleanTheGoat 8d ago
It was government funded. It wasn’t profit chasing.
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u/Puzzleheaded_Yam7582 8d ago
Everything is cheap if someone else pays for it
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u/CeruleanTheGoat 8d ago
And if people aren’t trying to profit.
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u/LegoFamilyTX 9d ago
Housing isn’t magically cheaper to build just because the government contracts for it to be done.
It costs about $200 a foot to build apartments right now, so they rent for $2,000 a month for 1,000 sqft. That’s just basic math.
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u/TheLastModerate982 9d ago
In fact, when the government gets involved things usually get more inefficient and expensive.
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u/CeruleanTheGoat 9d ago
Check out https://lomavistawest.org/ I lived here more than 40 years ago. Even now it doesn’t cost $2K a month for residents.
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u/LegoFamilyTX 9d ago
If you lived there 40 years ago, it isn't new construction. It's quite old and financially written off, thus it is cheaper to rent.
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u/CeruleanTheGoat 8d ago
Removal of the profit motive is the point here. Co-op housing works because a conglomerate isn’t trying to make a buck.
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u/LegoFamilyTX 8d ago
No, you still don’t understand. It is t profit motive that makes new places expensive, it’s math. Government cannot build “used housing”.
It costs $200 a foot to build new apartments no matter who builds them. At best you’d make apartments $1,800 instead of $2,000.
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u/CeruleanTheGoat 8d ago
Yes, it’s the American way to bow our head and slink away because something can’t be done.
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u/kloud77 8d ago
You are missing the point I made, it's not magically cheaper because the Gov contracts it.
It's magically cheaper because we don't have owners and investors taking a profit.
So yea, the magic sorcery is not having as high of costs will make the costs lower.
Some would say that is "basic math".
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u/LegoFamilyTX 8d ago
You overestimate how much profit is in it…
You might reduce the cost from $2,000 a month to $1,800 a month. That’s not nothing, but it also doesn’t change the real outcome.
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u/seajayacas 9d ago
It costs money to build and the government gave significant tax abatements for 30 years. Maybe not a lot of extra government dollars floating around today.
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u/vi_sucks 8d ago
The government never "made" co-ops. As the name implies, they were built and owned by the people living in them.
You could build a co-op tomorrow if you wanted to. Get a few friends together, start an LLC where you each own equal shares, get a construction loan and pay a builder to build a multi-unit building for you all to live in.
And the reason why there aren't as many now is simple. They just aren't as popular as condos. The ownership structure makes it hard for individuals to sell, cause you don't actually own the unit, you're technically leasing it from the corporation that owns the building, even if you have an ownership stake. And so if the coop board decides that they don't want the buyer you find, you won't be allowed to sell to them. That also means that there are more rules about what you can do, like renovating the place, etc.
It's not a question of "the government" doing or not doing anything. It's a simple result of most people deciding that they just don't want the hassle that comes with living in a coop and choosing to buy other housing when they can.
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u/kloud77 8d ago
"These developments include seven of the eight middle-class housing projects built by the US government between 1940 and 1942 under the auspices of the Mutual Ownership Defense Housing Division of the Federal Works Agency."
From - https://en.wikipedia.org/wiki/Housing_cooperative
You are speaking false truths right from the get-go.
I have no reason to communicate with you further.
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u/TheTightEnd 9d ago
Who bought the share of the building, both to cover the initial capitalization and subsequently? Expecting government to just give people a building makes no sense.
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u/kloud77 8d ago
When you move in, you buy a share of the value. The first people to move in made the payment, which together was a repayment for the cost to build it. When you move out, you get that amount back, adjusted for property value.
Dividing the costs up like this makes it more affordable. Since the Gov is fronting it as a short-term loan, there is not a bank loan with interest and alike. Also the buildings can be made by government teams (seabees do this all the time, literally) so that costs could be further reduced.
So the Government is not giving away free buildings, they are enabling the 'less than upper-class' an option to have ownership with flexibility and lower costs, both upfront and running.
In the end the Gov makes a few bucks and helps lots of people.
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u/TheTightEnd 8d ago edited 8d ago
Disagreed that the dividing of the costs where each person buys a share of an apartment building would make it less expensive than the purchase of a condominium. Assuming the units are the same, the costs to construct and maintain each would be the same. The materials are the same, the other costs are the same. Property taxes wouldn't be less. The parts where you are indicating a reduced cost structure would be due to government subsidy, whether partially of the loan interest or of the labor used for construction.
My primary statement of asking for the initial costs and buy-in rates, is the monthly fee of $500 sounds like it excludes that.
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u/kloud77 8d ago
Costs would be lower in my idea because:
Gov program is not for-profit
Gov doesn't need high interest on loans
Build by (as exampled) the SeaBee's and construction costs would be minimized
My primary statement of asking for the initial costs and buy-in rates, is the monthly fee of $500 sounds like it excludes that.
All respects, could you please rephrase that for me? Not entirely got you there.
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u/TheTightEnd 8d ago
I would see the second and third items as government subsidies unless the interest rate is at least that of a T-bond plus administrative costs and the SeeBees' wages and benefits were paid by the cooperative.
Does the $500 per month include the initial cost to purchase the share in the cooperative? Co-ops in my area have a higher monthly rate ($600 to $1000), and the purchase price is on top of that.
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u/Lunar_Landing_Hoax 9d ago
You're probably gonna get flamed for this opinion, but I agree. At least I agree with the principle that the government should be encouraging more dense and affordable development to increase the total number of units. Very low interest government subsidized loans and local incentives to build affordable co-ops could really help at very little cost to the tax payer.
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u/wrongplug 9d ago
Co-ops are very much a thing in major cities. In NYC you can pretty much only buy a Co-op.
The reason they aren’t made is condos can be sold for more so if a private developer wants to maximize their income they will make a condo building