Co-op buyers tie up less money during construction

Independent senior cooperatives—age-62-plus ownership structures that offer home appreciation and tax breaks just as regular homes do—are proving hugely popular with some Colorado buyers for their lower up-front payments and their more predictable return on investment. But they also offer something that’s hard to do in the current market—stay in your current house, without tying up lots of money, while your single-level home is being built.

One of those co-ops is headed for Westminster near Standley Lake—something you can explore by RSVP-ing for either of two coffee events on Wednesday, Sept. 8, at The Ranch Country Club, west of I-25 on 120th Avenue at Tejon Street.

There you’ll meet Bridget Young of Applewood Pointe, a senior co-op set to start construction next year a few miles west on a ten-acre site at Wadsworth Parkway and W. 108th Avenue. Young is originally from the Upper Midwest, where senior cooperatives originated before arriving in Colorado.

Early this month, Young saw a crowd of over 100 show up for a similar coffee about her project; and took numerous reservations.

“People like the low-maintenance, single-level design of these, but they also find it a more comfortable way to get started on what is a very challenging lifestyle move,” says Young.

“Buyers say they’re frightened by the run-up in home prices in Denver, and are unwilling to sell their current homes while they wait for a new one to be built.”

At Applewood Pointe, says Young, you can hold a position with a totally refundable deposit of $500, then pick out a home plan for $4,500.  As the project starts construction, owners have four options on how much to invest in their unit—just 20% (as little as $97,300) in exchange for a higher monthly co-op fee, or 40%, 60%, or 80% to get a successively lower monthly.

Those monthly fees cover virtually all expenses associated with ownership—mortgage, reserves, landscaping, interior/exterior maintenance, property tax, water, cable TV and WiFi, a dedicated heated parking spot (additional outside parking is available), and storage.

They also cover the amenities—club room, social areas, library, art/woodwork studios, and outdoor living spaces. The 10-acre site adjacent to trails allows for a putting green and a bocce ball court.

“Particularly if you opt to invest less, you can move in for a much lower commitment than typical homebuyers make,” says Young. “And the amount you’re tying up is small enough that you can keep possession of your older house during construction, maybe covering the up-front investment with a home equity loan.”

Co-op owners receive a flat 3% compound annual appreciation whenever they move on. What you won’t see are finished model homes (construction is expected to start in spring and finished units will probably deliver in fall, 2023).