A cooperative that is very closely related to housing is referred to as a housing cooperative and is designed to provide housing services to its members. What do we mean by this?
What is a housing cooperative?
A housing cooperative is a specific type of business corporation that may not be formed for the purpose of doing business. It is a legal person or a community of persons that is established for the purpose of providing for the housing needs of its members, may manage houses with apartments and non-residential premises of other persons, or may engage in business as a secondary activity.
K založení bytového družstva jsou zapotřebí minimálně 3 členové, každý z nich musí zaplatit základní členský vklad. Družstvo pak funguje tak, že vlastní družstevní byty poskytuje do nájmu svým členům.
Who owns a housing association?
In the case of privately owned flats, a Community of Unit Owners is formed to take care of the running of the community. When it comes to cooperative apartments, the ownership is exercised by the cooperative, the cooperator is a mere tenant.
What are the (dis)advantages of a housing cooperative?
Among the advantages of a housing cooperative is the fact that the land and the loan are arranged by the housing cooperative, its members do not have to take out a mortgage and pay some part of the price of the apartment as a basic membership share. The rest is paid back to the cooperative through rent. When they have paid off the full price of the flat, the cooperative then transfers it into personal ownership. The disadvantage of a housing association is that you are only a tenant, not the owner of the flat.