What are the types of housing co-ops and other shared housing models?

Meet Cathy, the Cooperative Development Institute’s new answerwoman! She can take on any co-op questions you might have, big or small. Today we ask: what are the types of housing co-ops and other shared housing models? See all of Cathy’s answers and ask your own on her home page.

Shared living space and shared economic security are the two biggest reasons that most people are interested in cooperative housing. Living with shared common space, whether in large single-family homes or larger cohousing communities, provides a sense of connection that many people are seeking in their lives. Owning real estate cooperatively can be a good investment for individuals or provide for long-term affordability, depending on the ownership structure. As long as every member gets one vote and the organization is managed democratically, it can be called a cooperative.

Do members have a claim on the value that accumulates in the property (the equity) or does it stay with the organization? The extent to which equity stays with the organization, rather than being distributed to members, is often the extent to which the housing becomes affordable relative to the market. In market-rate cooperatives, members buy and sell their shares on the open market, with the economics looking similar to condominiums. At the other end of the spectrum are “group equity” co-ops, where all the equity stays with the nonprofit corporation of which residents are members. In the middle are “limited equity” cooperatives, where members can sell their shares for a limited profit, agreed to ahead of time. This version allows for some individual profit, while keeping the housing below market rate.

Is the cooperative purely economic or is there shared space? Some co-ops are set up in one or several single-family houses, where each member has an individual room, but the kitchen, living room, and dining room are all shared. Some co-ops are at the other end of the spectrum, set up like an apartment building, with no common space, beyond maybe a laundry room and a lobby. In the middle of the spectrum are things like cohousing communities, which share land and common buildings, even though every member has their own living unit.

The aspects of cooperative living however, go beyond how much space is shared and who gets a vote. Other factors that make communities unique include a number of other questions.

Do individuals share the expenses of food or utilities? Whether a house is owned cooperatively or leased from a landlord, communities sharing housing space together can still function cooperatively and live affordably by sharing these daily costs of living.

Do members share their income or work together? For hundreds of years, monastic communities have supported themselves by growing food, brewing beer, and collectivizing their work and income. Many communities today still run businesses, grow food, or share the income from their separate paid work.

Is the community intentional? Do they share values, mission, and purpose beyond economics? Many cooperative housing communities gather around shared values that can be oriented to social justice, shared identity, environmental sustainability, or religious values.

Is it democratic? Is the leadership elected by the members? Many communities that share housing have a lot of characteristics in common with co-ops, but if it’s not democratic, it’s not a cooperative. (A note: A condominium is different from a cooperative in that each unit is individually owned, while in a co-op it’s shares that are owned.)

CDI has also prepared some handy graphics to illustrate this point below.