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There are several ways to buy a house beyond the regular acquisition by the owner according to the market prices, as we have already shown听some days ago, when talking about听social housing. In this post, we are going to focus on housing cooperatives.

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What is a housing cooperative?

Cooperatives arise from the need of several individuals to join their efforts to achieve common goals, to survive, and to improve their quality of life. These alliances are as old as human beings' history, and they have been perfected more and more to the point of being formalized in legal and validated contracts.

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A housing cooperative is a company whose purpose is to acquire a house in the best conditions of quality and price possible. These types of cooperatives have been consolidated in recent times as one real alternative to have access to affordable housing.

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Due to the complexity involved in acquiring a home through these types of companies, a cooperative manager is normally necessary. This professional will take care of all the required steps to deliver the houses to the members. His/her main functions will be to provide technical, legal, and also financial assistance to have a satisfactory process of housing acquisition.听

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Advantages听of the housing cooperatives

Although housing cooperatives are subject to specific legislation by country, we can find common characteristics and advantages of all of them:

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Absence of profit

This condition allows partners to obtain low prices by saving up to 20% of what the real estate market value would be. This percentage depends on the country鈥檚 regulations.

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This is possible because there is no private promoter that obtains a profit and it is the cooperative itself that acquires that function.

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Active participation of the partners in the design of housing听

Another advantage of the housing cooperative system is that the partners actively participate in the design of their own homes. That is, they can decide on how their homes and common areas will be since they are not imposed by the market offers.

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Payment听terms

听The payment terms are usually adapted to the economic possibilities of the members of the cooperative as long as the viability of the project is not compromised.

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Democratic functioning

The decisions will be taken by the majority and the value of the votes of each partner will be the same. This will guarantee possible disagreements between them.

Disadvantages听of the housing cooperatives

Just like every company or organization, there are always some negative aspects:

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Duration of the process

Unlike a normal housing acquisition process which is characterized by its relative immediacy, in a housing cooperative the term can be extended several years. The final term depends on the legislation of each country and the particularities of each project.

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Price variation of the housing unit听

The price may vary depending on the improvements established in the shareholders' assembly and it is a must to keep in mind that the final price is probably not the same as the one budgeted at the beginning of the project.

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Disagreement between the partners听

The democracy advantage offered by housing cooperative cooperatives can sometimes become an inconvenience because the greater the number of members, the more difficult it will be to achieve the different agreements.