Cooperative Housing Briefing Paper.
A COOPERATIVE PATHWAY TO ENDING HOMELESSNESS, INCREASING HOUSING SUPPLY AND REDUCING HOUSING STRESS
Paper prepared by representatives of: Society for Cooperative Housing New Zealand, The Urban Advisory, The Housing Innovation Society (THIS), CLOSER & Venture Centre
COOPERATIVE HOUSING AND THE PATHWAY TO COOPERATIVE HOUSING SOLUTIONS IN 2021:
The Good News
Innovative housing solutions to ending homelessness, increasing housing supply and reducing housing stress are possible. New Zealanders are working to deliver them now, cooperating in groups across the country. These solutions involve innovative kiwis getting on with the business of housing themselves.
The Bad News
As the solutioneers turn every stone to bring their cooperative solutions to fruition they find impediments. Regulations and legislation hinder them to house themselves, and make the valuable contributions innovators do, to achieving the kind of housing supply Aotearoa needs.
The Way Forward
Put cooperative housing developments on the housing agenda.
The Housing Innovation Society’s Policy Ask introduces new housing solutions including cooperative housing. It makes a case for sustainable and attainable home ownership models that give agency to communities, bring people together, provide security and enhance wellbeing.
Working with the Bank:
The Housing Innovation Society’s Reserve Bank submission suggests Banking Standards could be amended to make it clearer to banks that lending to alternative tenures, including cooperatives, should be supported.
A lot is resting with the Reserve Bank (the RBNZ Act is currently under review but does not capture the issues that we need addressed).
RBNZ has acknowledged that current prudential management is constraining housing supply. General banks are treating the lending to private housing cooperatives and progressive ownership as if they were not soundly-based. The timing is imperative – now – to address:
Poor prudential management on housing supply and innovation in tenure
RBNZ need to acknowledge that Basel rules support the definition of residential property to include private housing cooperatives, meaning banks can, if they wish, lend with the Basel rule
The lack of understanding by both RBNZ and politicians of the impact of BS2A and BS2B on lending behaviours, internal structures and resourcing of banks
The Proposed Deposit Takers Act could either make it easier or harder to force RBNZ to correct its mistakes. This needs to be considered now.
Introducing cooperative housing legislation:
Legislation specific to Cooperative Housing could be introduced, akin to the Retirement Villages Act 2003. Although different to Retirement Villages, Cooperative villages have a similar complex mix of regulatory requirements in order to protect interests.
RMA reform has the ability to focus more on outcomes and encourage regional and local councils to do the same. RMA processes have become increasingly prescriptive, as have the resultant district and regional plans that have evolved from it. The emphasis on iwi and environment is encouraging, however the rest has evolved from a lens still firmly focused on old paradigms (traditional development/housing models, roading, and the speculative housing market). The lens needs to be switched from government first.
Background Information:
Cooperative housing exists to provide a service that enables better housing solutions for those not served by mainstream, single unit owner/occupier housing options.
A cooperative is a scalable and agile model of delivering affordable housing. It is a democratic and participatory framework and set of tools (legal, financial, development and social structures) that can be used to address our homelessness and housing crisis, through asset-based community development.
Cooperatives have been proven to:
alleviate pressure on the public and community housing stock
alleviate wrap around services
be self-sustaining and increasingly resilient,
retain their affordability, and become more affordable over time,
support a broad range of people with differing housing needs.
New Zealand can refer to and lean on International Cooperative Standards to support New Zealand’s cooperative housing implementation, e.g.;
follow the International Cooperative Alliance’s principles and ethos, to: provide necessary and perpetual support for collective and community wellbeing based on self-help, self-responsibility, democracy, equality, equity, and solidarity.
This approach has been demonstrated globally, for 100’s of years, as a valid and valuable element of other nation-states non-governmental toolbox, its advantages being, to:
• draw partners together
• meet human-rights responsibilities
• deliver safe, healthy homes
• connect communities – for its citizens wellbeing
International Cooperative Data:
Cooperatives have been essential to rebuilding nations’ cohesive healthy communities.
Netherlands – 2.5m+ apartments (@30% of dwellings)
Sweden – 10m+ apartments (@16% of the population)
Germany – 2,000 housing Cooperatives, 2m+ apartments, 3m+ members
Australia – 5,429 housing Cooperatives, 1m+ members
Switzerland – 1,500 housing cooperatives, 160,000+ housing units. (@5% of dwellings)
Of particular note: a new breed of Cooperatives are leading large-scale city-shaping projects, extending beyond housing to include social enterprises and public facilities, growing Cooperatives in Zürich from the current 25% to 33% in coming years.
Norway – @40% housing in Norway’s capital, Oslo, a city of more than 600,000
America – 6,400 housing Cooperatives with 1.2m+ housing units nationally (@1% dwellings)
Internationally well-established cooperative ecosystems have been able to tailor cooperatives to serve the extremely vulnerable:
For example; in the USA the Cooperative Ministry provides single-mums in Kentucky, homes, debt reduction, money management, daily living skills
Nevada homeless veterans as member-shareholders work together and use their skills to create their own communities
The city of Vienna, refugees and formerly homeless are member-shareholders of their apartments and several co-located businesses providing training and employment through work in bicycle, woodworking and sewing workshops, a restaurant serving international cuisine and a café hosting events.
Positively and practically speaking – innovative kiwi’s are taking action:
New Zealand has the ability to enable a fast adoption and adaptation of cooperative housing solutions once recognised as part of the agenda to end homelessness, increase housing availability and reduce rent / mortgage stress.
Projects in progress by kiwi innovators include;
An open-source toolbox of legal and financial templates and frameworks (English and Te Reo) to draw in and support partners; community organisations; local government; iwi; and wider community partners (including; impact investors, building suppliers, land-owners / bankers and flax-roots community participants); to work together for mutual benefit on Cooperative initiatives.
Development of a pilot by CLOSER (one among a number of omni-considerate housing development organisations) and a ‘first-five’ cooperative developments, engaging with whanau, integrating advice and direction from Kaiwhakahaere Matua of Tauranga Moana Maori Incorporation, TPK, Papakainga block trustees and other project partners, some of whom are already engaged in housing projects with Kainga Ora.
• For example, engagement with Ngati Whakaue, the landowning partner of an 1100 home project in Rotorua, which is consented and is reviewing the master plan to design the development programme, will present opportunities for delivering a range of cooperative housing projects on housing super lots. The focus of the plan will be informed by the Rotorua housing stocktaking and the high homeless need. CLOSER plans to engage further with NWTL to deliver, at minimum, a homeless serving cooperative as part of the development.
Toi EDA, Eastern Bay of Plenty, have identified the need for housing in Opotiki for all parts of the housing continuum. Ngtai Whakatohea, kaitiaki of a large consented site (former hospital) and deep understanding of whanau’s needs are primed for discussion regarding delivering coops.
Formulation of the Social Architecture segment of creating cooperative housing is being addressed in, the ‘Cooperative Community Journey’ which includes integration of international best practice for creating, growing, and strengthening high functioning communities leveraging cooperative models, from project initiation to move-in, and beyond. Aspects covered include social connection, learning democratic decision-making, working bees, shared visioning etc.
Initial systems, resident guidelines, management and governance framework/ approaches are being developed to include specific needs and desires of various resident groups.
Governance technology – digital data sovereignty, management, measurement and augmented decision making tools are being developed to assist with viability and adaptation to ensure ongoing positive impact to individuals, families, communities and society at large through cooperative housing with cooperative governance.
Impacts of Cooperative Housing to be measured include:
The ability to use Governance technology – digital data sovereignty, management, measurement and augmented decision making tools means that Cooperative Housing will be able to be measured and managed in a more sophisticated manner than other solutions across the following dimensions:
Contribution to community wellbeing
Positive implications for physical environment / landscape (incl. carbon reduction)
Contribution to learning & education
Contribution to community resilience
Contribution to improved health
Contribution to improved family cohesion & inter-generational connection
Contribution to food security
Contribution to community support & volunteerism
Reducing mental-health issues, like anxiety, caused through unaffordable, unhealthy & unsustainable living solutions.
Skills, knowledge, experience contribution for common-good rather than personal gain
Equality of economic opportunity
Market for small co-op business enterprises
Increased level of local employment (& homes for workers & families)
Contribution to economic activity / Net Flow ($) implications
Rates contributions
Contextually & culturally appropriate & mana enhancing living environments
System change – supersede broken, out-dated property, finance & construction industry mechanisms predicated on private profit as the priority.
New Zealand demand:
Considerable demand analysis has been undertaken by local and central government. The demand for new housing solutions is clear, the need is indisputable.
Comprehensive research has been completed by project partner The Urban Advisory (TUA), both internationally and throughout New Zealand to understand housing demand, changing lifestyle preferences, the need and appetite for alternative housing models, and the barriers within a New Zealand context.
To ensure that there is sufficient end-user demand locally, surveys and Q&A sessions, and a registration process, has demonstrated the demand and interest in the cooperative products that are being designed. Consistently high turnout at public events, nationwide, and the popularity of the limited housing of this nature that is available, has confirmed the target audience.
A nationwide research project to interview representatives from existing and fledgling projects (using semi-structured interviews, and the snowballing effect to identify other relevant stakeholders) has demonstrated that the single biggest challenge to the adoption of new projects is the lack of comprehensive ‘pack (or toolbox) of information’ that outlines the appropriate legal, financial and governance arrangements for cooperative housing models.
The research demonstrated that there is a growing number of groups trying to solve the same problems, with limited resources, and that there is no suitable funding available that can be applied for, in order to develop the appropriate legal, governance and financial arrangements, adding additional cost to the already unaffordable housing and slowing down the design and delivery of projects which use models addressing homelessness.
Conclusion:
By introducing Cooperatives to New Zealand in a meaningful, managed and scalable way we aim to shift a meaningful percentage (2% within 10yrs/5% within 20) of ownership of land for homes and community development from individual commodity+speculative value; to a community's right, and a public-good asset responsibility for which the community democratically maintains.
Cooperative housing will deliver (at minimum) a sense of control to their owner shareholder-members, and at the other end of the spectrum, a base from which people can get on their feet, save for their futures, create community and thrive.
The barriers and challenges are clear – there is not yet a suitable system for which these projects can easily flourish, new contractual arrangements are required to provide the legal interests, and this requires significant investment.
International research has demonstrated the role of local and central government in building a self sustaining housing sector which answers both homelessness and affordability challenges – and this has included operational funding to support organisations to provide capability and capacity building services to implement new models. This research has been completed for Kainga Ora and can be made available on request.
Cooperatives are proven, across the world, to serve the homeless, create communities, deliver homes and change lives. It’s time cooperatives became part of the fabric of Aotearoa’s solution to the complex mesh of challenges causing homelessness, constrained housing supply, and rent / mortgage stress.
For further information:
Debbie Hallam, 0274875705
CoopHousingNZ@gmail.com
hallamdeb@gmail.com
Gillian Cook, 0211435943
gcook05@gmail.com
Greer O’Donnell, 0273094330
greer.odonnell@theurbanadvisory.com
Bobbie Cornell, 0228889993
info@closer.org.nz
Jo Allum, 0275266549
jo@venturecentre.nz
