Co-operative housing provides an alternative to renting and individual ownership. Co-operatives are a form of housing in which the members jointly own and manage the complex they live in. Housing co-operatives are associations of individuals who have come together to provide themselves with quality affordable housing. The main attraction of housing co-ops is that of stability and security of homeownership, together with greater flexibility and access.
Unlike private ownership, members do not need to assume individual responsibility for getting a mortgage.
The co-operative obtains the mortgage financing necessary to develop the housing project. Each month, the member makes a monthly housing charge payment which covers the household’s portion of the mortgage payment,taxes, insurance, and maintenance and administration costs. Since the members are co-owners, the monthly housing charges are set to cover the co-op’s actual costs. There are no hidden costs or profits included in the housing charge.
The basic structure of a co-operative provides the members with additional benefits not offered in other forms of multiple ownership (i.e. condominiums). Each co- operative member has only one vote. This provision ensures that the co-operative is a democratic organization, and cannot be controlled by a small number of shareholders who have a majority of shares in the corporation. In addition, only residents can become members and maintain their membership in the co-operative, thereby protecting the members against absentee ownership.
It is the co-operative who selects the new members of the co-operative; the members decide to whom the shares of a departing member will be sold. This enables the members of the co-operative to determine who will be part of their community.
There are four important advantages to non-profit, co-operative housing over rental housing.
1) Unlike rents, co-op housing charge rise only with increases in the operating costs and do not include any profits. Over time, co-op housing charges should be lower than rents for comparable rental housing.
2) Co-operative housing ensures an equal voice among residents in the decisions affecting their housing. There is no landlord.
3) Co-operative provides a unique opportunity for people to build a community and to share and assist each other in ways beyond their housing needs.
4) Democratic control guarantees that money budgeted for maintenance is spent on maintenance, and not skimmed off for extra profit while the property deteriorates
Membership in a housing co-operative is open to anyone who can use the services offered by the co-operative and who is willing to take the responsibility to participate in the management and operations of the co-operative. To become a member of a housing co-operative, households must purchase one or more shares in the association. When a member leaves the co-operative, the shares are sold back to the co-operative.
There are no income qualifications for any individual or family. Most non-profit co-operatives attempt to maintain abroad social and income mix. Most co-ops have special financial assistance to help low income households.
Co-op housing is not a new idea. The first co-operatives, building co-operatives, were very popular in the 1930’s. Continuing housing co-operatives made an appearance in the late 1950’s. Although slow to catch on, since the late 1970’s, there have been over 50,000 units developed across the country. In Edmonton there are 28 co-operatives, that have 974 units.
Co-op housing includes single family housing, duplexes, townhouses, mobile homes, and apartments. Families, couples and singles from all backgrounds, age groups and cultures live in housing co-ops. The thing they have in common is that they have discovered an alternative to renting that is more affordable than private ownership.
Housing co-operatives have developed a support system that provides the members with the resources necessary to develop and maintain their project. The support system includes co-op resource groups, responsible for providing the technical resources and expertise necessary to develop a project. A local federation of housing co-ops is responsible for providing ongoing management and member education, and a national organization of resource groups and housing co-ops responsible for working. ·on the development of programs to support the development of new hosing co-ops, as well as the ongoing operations of existing housing co-operatives.
In Northern Alberta, the Resource Group is Communitas Inc., and the local Federation is the Northern Alberta Co-operative Housing Association. The Co-operative Housing Foundation of Canada is the national organization.
As a co-owner, you have a say in the management and operations of the co-operative community;
As owners, there is community pride which results in a responsible attitude toward maintenance of both home and grounds;
You can make any improvements you wish to your home within the limitations set out by the co-operative. These limitations are decided democratically by the members;
You have the opportunity to set up other services such as daycare, food stores, and recreational facilities;
In the initial years, your housing charges may be equivalent to market rents for similar units, however future housing charges are based upon the co-op’s actual costs and will only increase when actual costs go up.
As long as members fulfill their obligations to the co-operative, they can feel secure that they will not have to move unless by choice. No landlord can come along and give you notice to leave.