Ownership Costs
Buying a share in a cooperative is similar to investing in a corporation. Your membership in the cooperative means you can occupy a specific unit. There is an up-front cost that must be paid in cash. The owner selling the unit sets the price. In addition, there are Monthly Carrying Charges and minimal out-of-pocket expenses.
Note: The Village Cooperative of Puyallup holds the title of the property and assumes the mortgage and tax obligations. Residents do not have direct liability.
Initial Cost
Each member holds one share in the non-profit cooperative, and the cost varies based on the size and location of the unit. However, the initial investment is considerably less than purchasing a single-family home or condominium/townhouse of similar size in this area. VCP holds a mortgage that is backed by U.S. Department of Housing and Urban Development.
Monthly Carrying Charges and Other Expenses
Monthly Carrying Charge Example
Below is a detailed explanation of how the monthly carrying charges are allocated. The example shows a carrying charge of $2400, which is the current average for all units.
A large portion of the monthly charges cover the cost of mortgage principal and interest, mortgage insurance premiums, and real estate taxes. The amounts for mortgage interest and real estate taxes are pro-rated for each unit and can deducted on your individual income tax return, if you itemize deductions. The carrying charge also includes overhead for the entire building and grounds, such as property insurance and maintenance, along with most of the utilities. The Monthly Carrying Charge is not dependent on the number of occupants in the unit. The other charges residents pay are for their unit’s electricity and Xfinity internet/cable TV/DVR at a reduced contract rate. The current monthly Xfinity rate is $69 and electricity generally is under $100. Insurance coverage is usually an “HO-6” policy (condominium unit owners).
Many potential members find this worksheet helpful when considering the on-going costs for a cooperative unit versus owning real estate.
