What is the meaning of the word “co-ownership” in the real estate sector?
Co-ownership simply refers to the ownership of a single good by several people. Thus, , real estate co-ownership is nothing but the fact for at least two people, to share the ownership of a real estate. . Many people may co-own a building or even a set of houses. The former kind is referred to as vertical co-ownership whereas the latter is called horizontal co-ownership. Vertical co-ownership: Here, each co-owner has sole ownership on one or many floors or part of a floor and a joint ownership on the whole building. Thus, each of them consequently pays charges based on the number of lots they own.
Horizontal co-ownership: When we mean a set of detached houses that are owned by many people, then we are talking about horizontal co-ownership. Here, detached houses belonging to different people are built on common land which is therefore divided into areas of enjoyment.If the management of an individual property is the business of the sole owner only, then how is a condominium managed?
How the condominium works
Whether it is a vertical or horizontal co-ownership, the real estate property is divided between two categories. These include private parts on the one hand and common areas on the other. The private parts belong exclusively to each co-owner while the common parts belong to the condominium. Each co-owner is necessarily full owner of at least one lot whereas a lot consists of a private part and a share of the common areas.All the co-owners form the syndicate of co-owners. The union’s mission is to manage the administration of the common parts and to preserve the property. The union is represented by by a trustee who is responsible for representing the condominium and taking care of its administrative and financial management. Among other things, the trustee must convene the general meetings of co-owners, keep the accounting of the condominium, ensure the maintenance of the property, manage the staff of the condominium and represent the syndicate of co-owners, etc.
Furthermore, the trustee is liable when he commits a fault with the union or one of the co-owners. However, when a fault is committed against a third party who is not of the union, the responsibility of the entire union is incurred. Now that the concept of real estate co-ownership is more or less elucidated, let us take a closer look at the benefits it could bring but also the risks associated with it.
What are the benefits of co-ownership?
A genuine time saver: since the trustee is the one who takes care of the maintenance of the building, the co-owners have less to worry about and can devote their time to other things.
Lower expenses: the expenses incurred are shared between the co-owners, and thus, these generally become lower for each.
Security: It is important to note that living with neighbours in the same building provides more peace of mind regarding to break-ins.
Sociability and solidarity: as trivial as they may seem, these benefits are not the least. Life in co-ownership, with the collaboration between union members that it involves, will lead each co-owner to develop the ability to live and work with others. I am even tempted to say that this life together arouses altruism in each co-owner insofar as they find themselves obliged to think of others on a daily basis.
It is well and good to list the benefits of co-ownership, but ignoring the few drawbacks of this lifestyle would be a mistake.
So what are the drawbacks of co- ownership??
– The insolvency of some co-owners: There may be black sheep in the rank of co-owners. Some may therefore fail to pay their fees despite reminders from the trustee, whereas in any cases, the union must pay for the expenses.
Long decision-making process: since the simplest decisions must be taken in the community through a vote and a minimum quota to be reached, the procedure is further lengthen.
Threatened privacy: Generally, the internal regulations set limits, especially on noise pollution. However, in case of soundproofing problems for example, you will sometimes have to hear what your neighbours say from their apartment and vice versa. A detached house would give you more privacy.
High vacation rate: With the freedom restrictions that apply to condominiums, and in turn to tenants, this one appears more restrictive than renting an apartment in a single-owned collective building. As a result, tenants often prefer to resort to a detached house where possible. Thus, the higher the number of neighbours in a building, the less interested are the customers; which is bad for real estate profitability.
Real estate co-ownership in Benin
Considering the generalist points outlined above, it is easy to say that real estate co-ownership deserves an interest. Its benefits are not negligible and an investor engaged in it will certainly not be disappointed if he or she is dealing with professionals and identifies the right targets. That said, real estate condominiums would abound if everyone fully understood the operation of this system. In a country like Benin, where real estate is prized, how is real estate co-ownership perceived today?
The Beninese and the real estate condominium
Le Bénin est un pays dont les habitants ont une attache particulière au domaine de l’immobilier. Au Bénin, on aime être propriétaire terrien. Les Béninois, pour la plupart, tiennent énormément à avoir leur propre chez. Et c’est peut-être de là que vient le problème. Avoir sa propre maison en copropriété, pour un Béninois, est difficilement envisageable avec les contraintes que celle-ci impose. Un individu qui prévoit acheter sa maison ne pense pas souvent à la possibilité d’acheter un appartement dans un immeuble en copropriété car on accorde beaucoup d’importance à la liberté dont on peut jouir dans sa maison individuelle, sans voisins « encombrants ». L’engouement pour les maisons individuelles au Bénin nourrit la flambée des prix : puisque tout le monde veut avoir sa maison, et ce exclusivement, les terrains et les maisons reviennent plus coûteBenin is a country whose inhabitants have a special attachment to real estate. In Benin, we like to be a landowner. Beninese, for the majority, are very keen to have their own house. And that may be where the problem arises. It is hardly possible for a Beninese, to think of getting a house in a condominium, with all the constraints that it imposes. They highly value the freedom that can be possible in a detached house. The craze for detached houses in Benin is fuelling soaring prices: since everyone wants to have their own house, and this exclusively, land and houses become more and more expensive.
Expanding condominium real estate investment in Benin
A boom in the real estate condominium subsector would certainly make the real estate sector more attractive. To achieve this result, several mechanisms can be exploited, among other things, an awareness of the benefits of co-ownership in terms of investment costs and profitability; government programs to drive the subsector into strength; tax facilitations, etc.In short, real estate co-ownership offers many advantages despite the few drawbacks it presents. Both investors and individuals would benefit from adopting this method of investment.
Faliratou OROU DAMA