Co-ops Are a Good Housing Choice

1. Co-ops Are a Good Housing Choice Deb Trocha Executive Director Indiana Cooperative Development Center 2019 Prosperity Indiana conference Jan. 30, 2019

2. Who we are… • 501(c)3 nonprofit which provides development services for new and existing co-ops • Our mission is to foster community economic development through the cooperative business model • We provide • Technical assistance • Education • Advocacy, referrals and access to resources

3. A Cooperative Is….. An enterprise formed by a group of people who join forces and work together to solve a common problem or to reach a shared goal

4. Three Ways Cooperatives Are Differentiated from Other Business Entities… Member Ownership Member Control Member Benefit

5. Guided by Cooperative Principles Voluntary and open membership Democratic member control Member economic participation Autonomy and independence Education, training and information Cooperation among cooperatives Concern for community

6. Basics of housing cooperatives

7. History 1857 – first recorded housing co-op created in New York City (artists) 1916 – first full residential housing co-op begun by Finnish immigrants 1930s – expansion of co-op enterprises including housing co-ops including the first student housing co-ops 1950s – another growth spurt in response to post-war housing boom 1970s-80s – Many new housing co-ops created with assistance from various government programs

8. Statistics Population: 312,913,872 Total housing stock: 130,599,000 dwellings Total social (rental) housing stock: 1,200,000 dwellings Total co-op housing stock: 6,400 housing co-ops Housing co-ops account for 1% of all housing units 2010 statistics from NAHC (National Assoc of Housing Cooperatives)

9. How Does a Housing Co-op Compare with Other Housing? In a condominium association, each individual owns a divided piece of the property. In a housing co-op, all members combined own an undivided share of the property. In a rental apartment, tenants own nothing.

10. Types of Housing Co-ops • Market rate • Limited equity • Mobile home parks or manufactured housing communities • Student housing • Senior housing

11. Wide Variety of Housing Co-ops • Traditionally located in urban areas • Increasingly seen as a way to meet rural housing needs • Can be structured as: multi-family or apartment type dwellings single family homes located close together manufactured housing parks townhouses, garden apartments scattered site • Vary in size from very large to very small • Can be new construction, renovated or existing housing

15. Benefits of Housing Cooperatives

16. Individual benefits • Affordability • Accessible home ownership • Flexible housing model • Financial advantages • Home ownership • Supportive community

17. Social benefits • Self management • Community control • Leadership development • Democratic participation • Enhanced security • Lower rates of mortgage delinquency and default

18. Community Benefits • Engine of economic growth • Stabilization of changing neighborhoods • Stabilizing out-migration in rural areas: retaining an important asset base • Engagement • Growing popularity ensures financial health

19. Challenges of Housing Co-ops…. • Tenant mindset • Desire for single-family housing • Desire for sole ownership • Restrictions on resale • Submitting to group decisions • Close living • Complexity of organizational process

20. In Summary….. • Co-op model is proven • Offer many advantages to individuals and their communities • Wide variety of housing co-op models • Can provide the answer to both urban and housing shortages

21. THANK YOU! Deb Trocha Indiana Cooperative Development Center 225 S. East St., Suite 737 Indianapolis, IN 46202 317.692.7707 Fax: 317.692.7787 dtrocha@icdc.coop