Certified Residential Appraiser Practice Exam

A distinguishing feature of a Cooperative Ownership is that the title is held by?

1. Individual property holders

2. A partnership of owners

3. A trust or corporation

4. A limited partnership

The correct answer is: A trust or corporation

In a Cooperative Ownership, the title to the property is held by a corporation or a trust. Individuals who reside in the cooperative do not own their specific units directly. Instead, when they purchase a share in the cooperative, they gain the right to occupy a particular unit and participate in the governance of the cooperative, but the actual real estate is owned collectively by the cooperative entity itself. This structure fundamentally differentiates cooperatives from other forms of ownership, such as condominiums or single-family homes, where individuals hold their own titles to the property. The corporate structure allows for collective decision-making regarding the property, including financial management, maintenance, and governance, which can lead to shared resources and responsibilities. This setup can be beneficial for fostering a strong community among residents and providing a unified approach to property management.