Humber/Ontario Real Estate Course 1 Exam Practice

Which statement is correct about co-operative housing?

1. It is always non-profit

2. Involves ownership by a corporation with members leasing specific units

3. Managed by the Co-operatives Agency under the Co-operative Corporations Act

4. Shareholders in an equity co-operative can own specific units

The correct answer is: Involves ownership by a corporation with members leasing specific units

The statement regarding co-operative housing that focuses on ownership by a corporation with members leasing specific units accurately reflects how co-operative housing structures function. In a co-operative, individuals do not own their specific unit outright; rather, they own shares in the co-operative corporation. This ownership grant shareholders the right to occupy a specific unit through a lease agreement with the co-operative. This arrangement distinguishes co-operative housing from traditional ownership models. While other statements may contain some elements of truth, they do not fully capture the essence of co-operative housing. For instance, not all co-operatives operate strictly on a non-profit basis as they can also have profit-generating elements depending on their structure and purpose. The management of co-ops is typically not exclusively under the Co-operatives Agency; this varies by region and co-op regulations. Additionally, in equity co-operatives, while shareholders might have a claim to the assets of the co-op, this does not translate to owning a specific unit outright; their ownership is still tied to shares in the overall corporation.