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Membership Housing

Discussion in 'Anything goes' started by Songbird, Mar 27, 2017.

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  1. Songbird

    Songbird Well-Known Member

    Looking for thoughts and insights and wisdom (possibly experience) y'all might have about "membership housing" ... in which you pay something like $115,000 or $150,000 to able able to rent a place. And then you get your buy-in money back when you leave. I assume you have to stay a set amount of time to get that money back.
     
    Songbird, Mar 27, 2017
    #1
  2. MisterCreosote

    MisterCreosote Well-Known Member

    That sounds awful.
     
    MisterCreosote, Mar 27, 2017
    #2
  3. Batman

    Batman Well-Known Member

    Is "membership housing" the 21st century term for "time share?"
     
    Batman, Mar 27, 2017
    #3
  4. playthrough

    playthrough Moderator Staff Member

    I'd have a very, very good lawyer look at that contract.
     
    playthrough, Mar 27, 2017
    #4
  5. Songbird

    Songbird Well-Known Member

    It's a new development for downtown here ... akin to a membership fee to join an exclusive ski club i.e. it costs $75,000 to join The Hermitage Club in West Dover Vermont, and you still have to pay yearly fees. But you never have to wait in line to ski.
     
    Songbird, Mar 27, 2017
    #5
  6. qtlaw

    qtlaw Well-Known Member

    Timeshare is definitely what comes to mind.

    In the abstract, think about what you are getting for your $$; the right to stay there; which is essentially, legally commonly known as a license. An intangible item. There's no substance. And if you're thinking that the property is security, that's when you need to read the fine print. How many people will be clinging to the same security? If its 10 people total, then okay (usually an arrangement called tenants in common); but if its 50? Then you've got a problem. Plus, where's the $$ go to at the start? Well the developer pockets it, then you have no control over where it goes from there. Not ideal.
     
    qtlaw, Mar 28, 2017
    #6
  7. LongTimeListener

    LongTimeListener Well-Known Member

    Definitely thinking of Groucho's "I would never want to belong to any club that would have someone like me for a member."
     
    LongTimeListener, Mar 28, 2017
    #7
  8. The Big Ragu

    The Big Ragu Moderator Staff Member

    What is the benefit of handing $150K to someone to RENT a place? I must be missing something. Two of the main benefits of renting rather than buying are 1) there isn't a big down payment, 2) you retain relative flexibility.

    That takes away both of those benefits -- except you get zero equity in return. What you described sounds like a very expensive security deposit. But why would anyone pay it? The only way it might marginally make sense is if you were able to resell your "buy in" when you want to move, in which case you'd be hoping for capital appreciation. But even with that, you'd have to evaluate your rental. ... as an investment. And it isn't what you described.
     
    The Big Ragu, Mar 28, 2017
    #8
    Inky_Wretch likes this.
  9. Jssst21

    Jssst21 New Member

    It actually might be set up as a co-op where a corporation holds title, you pay X to the corporation and receive a lease back for your share (your unit) of the corp until you choose to leave. Ordinarily, you would then be able to sell your shares of the corporation to the next guy at a profit you would retain, but here it seems they are keeping any appreciation there might be. Not really enough information to be certain, but that would be my best guess.
     
    Jssst21, Mar 28, 2017
    #9
  10. dixiehack

    dixiehack Well-Known Member

    And with all the money you make, you can buy a "personal seat license" for the right to buy season tickets!

    Pass.
     
    dixiehack, Mar 28, 2017
    #10
  11. The Big Ragu

    The Big Ragu Moderator Staff Member

    He said it was a buy in to rent. ... I own a co-op apartment. Yeah, I own shares in a corporation. It covers a percentage of the underlying building and common elements. It also means I physically own the little piece of the building I inhabit. I am not renting the place from anyone. If I want to sell it, I do it the way anyone would if they were selling their home -- except within the way co-ops are structured, I would sell my shares to someone else (at a profit or loss). I didn't get any of that from what he described.
     
    The Big Ragu, Mar 28, 2017
    #11
  12. Jssst21

    Jssst21 New Member

    Fair enough Ragu - what he is describing doesn't really resemble anything I am familiar with, so I was guessing, maybe someone came up with a co-op with a structure where you have to sell it back to the corp when you leave at the same price you bought. Crappy deal if that is the case. If it is as described, and you're just renting and paying for the privilege to do so, it makes little sense.
     
    Jssst21, Mar 28, 2017
    #12
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