Housing Co-ops
This leaflet is actually by Catalyst
Collective Ltd another group who are good friends of PFAF.
Plants For A Future no longer has a housing co-op.
If we are to work towards a fairer, more sustainable society, it is
essential that our shelter/ housing is provided in accordance with this
vision: a society "based on the values of self-help,
self-responsibility, democracy, equality, equity and solidarity" where
people believe in the "ethical values of honesty, openness, social
responsibility and caring for others" (to quote the Co-operative
Principles).
Whether large or small, housing co-operatives recognise that no-one
other than the tenants themselves are better placed to know what needs
to be done to improve their housing situation.
Housing co-ops can help us to:
- take control of one of the most basic needs in our life - shelter;
- escape the circuit of depressing bedsits and shoddy housing that make
up much of the 'private rented sector';
- establish a new form of social housing;
- break down the 'poverty trap' or 'benefits trap'; and
- avoid the pitfalls of buying houses privately with a mortgage around
our neck.
If those seem like pretty grand claims, here's some explanation:
- the desire to take control of our shelter is an obvious one, and
explains why many choose to buy their own land or house. However, for
some of us that is not an option because we cannot afford it. For
others, private ownership of property is unethical. Housing co-ops
enable small [or large] groups of people to take control of property and
satisfy our needs whilst retaining the ethical nature for those of us
who prefer common ownership. Although difficult because of the planning
system, housing co-ops can also allow for alternative, low-impact forms
of accommodation such as benders, self-build, caravans, underground or
low-energy houses.
- Many landlords are mainly in it for the money, so are not interested
in providing us with the best accommodation they can afford, as a
housing co-op would.
- Councils sold off council houses under the 'right to buy' but were
not allowed to plough the money raised from this back in to building new
houses. So the traditional form of social housing declined, with the
claim it would be replaced by a new form: Housing Associations. However,
their efforts have been hampered by continually decreasing levels of
Grant available to them, and they too will suffer under the 'right to
buy'. They have turned to the private finance markets for loans, and
their rent levels have been driven up to 'market rent' level. And, with
both councils and housing associations, their waiting lists are now too
long for them to provide a solution for many whose housing need is real,
but not desperate.
- With rents at 'market' level [i.e.. as high as the landlords can get
away with] it can be difficult to find or create employment which
genuinely leaves us financially better off than when claiming state
benefits. With a housing co-op the opportunity exists to bring the rent
down to a basic maintenance level and escape this 'poverty trap'.
- Many people took advantage of the eagerness of mortgage lenders
during the property boom and are now suffering the pitfalls of the
housing market. Their home may be worth less than the outstanding debt
owed - 'negative equity'. Whilst housing co-ops can suffer the same
fate, in general they are less likely to be selling since they will
value the continuing physical existence of the housing. One of the real
advantages of using a legal structure like a housing co-op is that it
can stay in the same place whilst the people can move on, as long as new
members are found!
The Practicalities
A housing co-op is, on one level, a group of people who have control
over their own housing, without actually owning it personally. The legal
structure, technically an Industrial and Provident Society, can be
thought of as a separate person, who owns the property, takes out
mortgages, and to whom the tenants pay rent. This separate person,
however, only does what the members of the co-op tell it to! Indeed, as
a registered legal structure, the co-op is treated legally as a 'legal
person', so this analogy is quite accurate.
A housing co-op is very similar to a housing association, but it is
managed (either entirely, or mainly) by its tenants. If it is 'Fully
Mutual' only tenants or prospective tenants are allowed to be 'members'
and control/manage its affairs. (Our Rules are for fully mutual co-ops),
Housing Co-ops, like all other Industrial & Provident Societies, are
registered with the Registrar of Friendly Societies.
Once registered, the co-op can lease or buy properties, and then rent
them, either wholly or as flats/bedsits/rooms, to its members - who pay
rent to the co-op, which is their landlord. So, by registering a co-op,
we create our own landlord, created for our benefit, with us, as
members, collectively making all the decisions that need to be made -
what property to buy, what rent to charge, whether to allow Jo Smith to
join, what colour to paint our rooms, whether to install low-energy
lightbulbs or water filters, etc. Co-ops allow us to reclaim aspects of
our lives and distance ourselves from some of the hierarchical
structures of society, without having to take part in the "home owner,
this is mine, consumer" debacle. And they encourage greater co-operation
with each other as tenants.
The co-op is a 'private landlord'. And fully mutual co-ops can claim tax
exemption on 'rental income': this means it pays no tax on the rent it
receives, so if it is making a 'surplus' [income higher than expenses]
it can save this up without penalty, ready to buy another house or make
improvements to existing ones. Other income (if a profit is made at the
end of your financial year) will incur corporation tax. And, the co-op
can claim MIRAS tax relief - as individuals do - although we don't know
how long this tax relief will continue to exist. MIRAS is tax relief on
mortgage interest; effectively it reduces your mortgage payments.
Loanstock
Loanstock is a way that housing co-ops and other IPSs can raise money from
supporters. It is one way that people can lend your co-op money, and it
is the easiest way in which the co-op can advertise publicly that it is
seeking financial support. Our info pack provides models of the
documents needed to run a loanstock scheme. Radical Routes has invested
much time and money developing this pioneering way of generating private
finance.
Registration
Catalyst Collective carries out the registration work of Radical Routes,
although you don't have to join RR for us to register you. . We provide
a pack of information, (including the addresses of the DoE etc. that
you'll need to claim tax exemption etc.), Really all you need to know
from day one, with copies of the model documents also on disk so you can
print out your own documents, and a company seal (a legal requirement).
The Next Steps
Radical Routes will soon [Autumn 96] have a book available "How To Set
Up a Housing Co-op" which details all the likely steps involved
in the process, and we recommend you read this. The book has been
written using the experience of several co-ops, and talking to those who
have done it already is the best way to find out whether it is a
suitable path for you to follow.
Until then, send a letter with your questions [and a SAE!] to Catalyst
and we will try to answer your queries or put you in touch with those
who can. We will also send you more details of our registration service.
Catalyst Collective
We are a common ownership worker co-operative set up to educate and
supply information about sustainable actions and lifestyles, encouraging
individuals and groups to take responsibility for the consequences of
their own actions. we believe social and environmental problems should
be tackled with innovative ideas, co-operation, human dignity, self-
empowerment and fun!
To carry out our aims we offer our co-op advice and registration
service; we are involved as individuals in various campaigns and
initiatives locally and nationally [LETS, Plants For A Future, Education
Otherwise, ICOM ...]; we produce GreenLine Magazine in which we provide
information and inspiration towards a co-operative sustainable lifestyle
[SAE for a sample copy] and we contribute 1/2% of our costs to
tree-planting.
Radical Routes
Radical Routes is a network of independent co-operatives working for social change.
We are creating bases from which to resist and challenge dominant
structures in society, and aim to develop an alternative economy and way
of living. RR co-ops are involved in a wide range of socially useful
activities, including organic vegetable distribution, catering,
computing, electrical contracting, permaculture, disablility campaigning
and more.
If you would like to know more about or how you can support its member
co-ops through the national loanstock scheme, contact RR at 16
Sholebroke Avenue, Chapeltown, Leeds LS7 3HB. Send £1.50 if you want a
directory of co-ops.
Other pages about housing co-op's include:
UK housing co-operatives,
Homelessness in the UK - Co-operative housing and
International Communities
and our own links page on
Communities and Eco-villages.
Readers Comments
Housing Co-ops
Rich
Sun Oct 23 2005 The experience of housing co-ops and wokers co-ops at
Plants for a Future has been mixed. Rather than a Housing co-op
owning the house it was actually owned by a Workers Co-op.
This led to several problems, firstly it became dificult for
the directors of the workers co-op to claim benifits
while living in the house.
Moreover ownership of a house by a wokers co-op led to a situation
of a tied house, more akin to 19th century model where the factory owner
also owned the workers housing. This basically created a landlord-tennent
situation, and is far removed the idea of residents control over
their own property which is a model of a workers co-op.
This situation has led to a long running point of contention and
the house has now been sold. My advice to anyone considering this
model is "If your going to have a housing co-op,
have a housing co-op, nothing more nothing less".
Housing Co-ops
sarah
Thu Feb 23 2006
it didn't really help me find what i was looking for... AT-ALL! Sorry
Housing Co-ops
Thu Jan 25 2007
Directory of Housing Co-operatives in the United Kingdom Add a comment/link:
Discussion Monitor
To have posts to this page mailed to you enter your email address here:
(Your email address will not appear on the webpage or be passed on to third parties).
|
|
This work is licensed under a
Creative Commons License. You
can copy, distribute, display this works and to make derivative works but: Attribution is required, and it's Share Alike (GNUish/copyleft)
i.e. has an identical license. We also ask that you let us know (webmaster@pfaf.org) if
you link to, redistribute, make a derived work or do anything groovy with this information.
