Co-ops in Leisure World

I’m often asked, what is the difference between buying a co-op and a condo in Leisure World?   Thus, I decided this topic deserves its own blog post.  Co-ops in real estate in general are defined as owning a share in a co-operative, rather than owning a physical unit.  You buy and sell this share much as you buy a condo or home, but there are usually a few differences.

In Leisure World, one difference is that the co-op fee covers much more than the typical condo fee.   It covers your property taxes, since the co-operative pays property taxes for all of the units.  It covers much of the equipment in your unit, including the HVAC, plumbing, and any appliances that are original to the unit, since the co-op technically owns the unit.  And it covers all utilities for the unit.  

There are also additional requirements to buying a co-op at Leisure World.  You must have at least a 700 credit score, even if you’re paying cash for the property.  You must show proof that you already have three-years-worth of the condo fee saved (could be in a retirement fund, doesn’t have to be cash).  These requirements were mandated several years back, because many people could afford the initial purchase price of a unit in the co-op, but were then defaulting on the monthly fee.  You also have to use a lender (if you intend to use a mortgage to purchase the property), and a settlement company that have been approved by the co-op.  I have an updated list of the lenders and settlement companies that are approved by the co-op, so please contact me if you want more information about this.

The co-op section of Leisure World, called Montgomery Mutual, was the first section of Leisure World that was constructed, and the buildings date from the late-1960s to the early-1970s.  As such, they tend to be among the least expensive units in Leisure World, and are therefore very attractive to many buyers.  They range from studios with a square footage of 635 square feet, and a price range of 75K – 96K in the last six months, to two-bedroom townhomes with 1600 square feet, and a price range of 168K – 192K in the last six months.  One issue to be aware of is that none of the co-op buildings have elevators, so owners must be able to either do a flight of steps to reach their unit, or do a flight of steps within their unit, as is the case with the townhomes.  Occasionally, though, a ranch-style home becomes available (selling in the mid – high 200ks in the last six months), or a buyer might be able to find a unit on the main floor of a building, therefore not requiring the ability to climb any steps.  Another issue is that some of the buildings have common laundry areas, rather than each unit having a washer and dryer within it.  But many units do have their own washers and dryers.

If you have questions or further interest in buying or selling a co-op at Leisure World, please don’t hesitate to contact me.  Thanks!