What is a housing cooperative?

A Housing Co-operative, or co-op, is a home where people choose to live in community.

The main characteristics that are evident in a co-op are sharing, working together, and group decision making.  This usually means that in co-ops, people cook and eat together often,  jobs are shared, and many purchases are made in bulk for shared items.

Co-operative ownership can mean that a Co-op corporation owns the property, with residents being sharholders in the co-op, or sometimes an LLC provides essentially a very similar group ownership mechanism.  Sometimes a co-op is a group of people who pool their resources to rent their space.  The definition seems to be quite wide, however, the techinical definition would be limited to situations where the actual ownership was somehow by the community.

Co-operative Living: Popular culture today encourages us to be isolated, to turn on the tv and never to have a big potluck meal.  Co-operative housing is for people who want to know their neighbors, who want to be part of, contribute to, and benefit from a community.  Co-ops are for people who are willing to do their share (sometimes more) because they love their community and want to see it thrive.

Co-ops are characterized by the Rochdale Principles named after the first successful co-op which was started in Rochdale, England in the 1840’s.

This is a paraphrased version:

  • Open Membership: A co-op does not discriminate. Anyone can join.
  • Democratic Control: The co-op is owned and operated by its members. Each member gets one vote (unlike publicly-traded companies in which those who buy the most shares get the most votes).
  • Limited Return on Capital: A co-op is not intended to be a money-making enterprise for its members. Members may thus be paid only a “limited” amount of interest on any money they invest. (Most co-ops have a very modest investment requirement. My local credit union requires only a $5 lifetime investment.)
  • Surplus Belongs to Members: Since the members are the owners, they receive any profit the co-op makes. In many co-ops the profits are reinvested into the business rather than being returned to the members.
  • Honest Business Practices: Cooperatives deal openly, honestly, and honorably with their members and the general public.
  • Ultimate aim is to advance the Common Good:The ultimate aim of all cooperatives should be to aid in the participatory definition and the advancement of the common good.
  • Education: Co-ops are expected to educate their members, officers, and employees and of the general public in the principles and techniques of cooperation, both economic and democratic.
  • Cooperation among Cooperatives: Co-ops should actively cooperate in every practical way with other cooperatives.