I have been a member of a housing cooperative for 30 years and have lived in an apartment belonging to this cooperative for 25 years. The rent is low and the apartment is very nice and modern. I can't imagine anything better.
That's so cool. The whole program for housing is really cool in my opinion. I would love to see more. From what I gather it can be really tough to get one in my cities. But once you are in, it's great.
@@TypeAshton "But once you are in, it's great" So basically homeownership as well. Sure a mortgage sucks but you build equity. Of course that's if you can ever get a foot in that ladder...
I’m curious, maybe skeptical, of the statement that home ownership is a cornerstone of building wealth in the U.S. Like car ownership, the costs are often not recognized, even hidden.
I’m also curious about what it would take to increase the proportion of U.S. housing stock that is cooperative housing. It may take some government subsidies. It also may require more changes in thinking and in tenant culture in the U.S. certainly some U.S. regions are further along than others. People have examples? Any data on areas in the U.S. that have more coop housing than other areas? Where would a person find that data?
You're 100% right with every thing you're saying. And yet, there's one thing that's being overlooked here: there's a reason that's not taken into consideration here when it comes to why living in a multi-family house is so unpopular in the US. And I myself only understood and all too well after having stayed in such a multi-apartment building in the Bay Area with a friend for a while. In Germany I've lived in these kind of buildings for the last five decades and was never much bothered by living wall-to-wall with other people and families. Why? Simply because the way German houses are build it ensures your sound privacy even when living in tiny apartments. You simply don't hear your neighbors or if you do, it's some undistinctive muffled noise and maybe some childrens laughter every once in a while. I was flabbergasted when I realized that I overheard every, and I mean EVERY word my friend's neighbor was saying in his flat next door during the entire day while he was working from home and in such clarity, that I could've recorded it on tape. And no, he wasn't yelling. Just normal conversation with his partner or on the phone. I would clearly not want to live in a place where nothing I say stays within my own walls, no matter how affordable it is! So unless the US house building upgrades from cardboard walls to something more soundproof (and sturdy and durable), I can see why people prefer to have a bit more distance between them and the people next door.
Yes you are quite right about that. Germans have thick walls. Even in my German flat, I cannot hear the nearby train when it comes by if the window is closed. American construction quality is poor. Unfortunately, you have to ask Americans to build something that lasts and we are not good at that yet. We are too focused on "aesthetics" like how the lawn looks or exterior/interior design over good quality materials.
Meh. It varies. One condo I had in the US had such good soundproofing that I couldn’t hear the musician next door when he practiced his guitar. Never heard any sound from either of the adjacent units.
Another thing about co-ops is that the fee that you have to pay is in many cases as high as your mortgage. I wanted to buy in NY/NJ area and they are about 150k, but when you factor the HOA, you end up paying a monthly mortgage equivalent to a 350k house if not more. This is for older units, new units are far more expensive. Even if you think this is good, remember that the Co-op has to fix and the building and some assessment after 10, 20, 30 years can be in the millions. Look at what is happening in FL with condos. HOA's skyrocketed to have money in reserves and on top of that each unit needs to pay ~150k to pool all the money to make the fixes to the building and keeping it legal, and safe.
100% agree. I lived in Germany as a child and never heard our neighbors. The most quiet multi-housing unit I’ve ever lived in. Even outside was quiet. Moved back to the US for college and everything is loud and noisy. Not to mention the high crime rates. Tschüss
I live in Germany, those buildings are rare and the crisis is bad honestly. For students a private room in a shared apartment between 3/5 people goes for 600 usually if you live in a city. Its low-key almost unaffordable
You probably live in the west then. That sounds like Berlin or Munich prices to me. Over here in the East the situation is better, though not entirely perfect either. While the Genossenschaften are fairly large and the housing affordable, private Scum like Vonovia is busy squeezing every bit of money out of their rentera here too.
@@TheBrazilRules In most cases, the public pays for it. First in subsidizing it, because it is "necessary" to have "housing". After it is finished, you have mostly migrants with connections living there through the "social system", often with no backgroundchecks who actually lives there. It's mostly a thing in left-wing ruled cities or university cities. So, it's expensive, because others will pay for it.
I'd argue that is an infrastructure issue. Obviously universities can't be everywhere but having local shops and some amount of internet and entertainment would make the village my grandmother was raised in viable to return to.
I used to live like that. I paid €300 per month with free water, heat and electricity for a fairly big apartment. However I sold it for a house and now I pay that much for electricity alone thanks to high energy prices in recent years in Europe. Even water has gone from 30 bucks a month in 2022 to 70 bucks a month. These inflation years would have been so much easier if we still lived there. But my wife really wanted a house. But it’s me that has to mown the lawn and take out weee in the harder and oil the veranda. I do love not to have to worry about neighbours and having a veranda but it’s no denying the coop apartment was extremely cheap. We even had solar panels on the apartment buildings and we had just renovated the bathroom kitchen and the kid had other kids to play with. Here the only neighbours are pensioners. In the coop they had just put new playgrounds. We had several very nice playgrounds. Now we only have a trampoline and some swings in our yard and no other kids come to play so they barely get used. I think it might have been best to have the apartment but then a summer house for when you feel like you want your own space.
That, but on a massive scale is probably why north America is the way that it is. Kids grow up isolated, don't get much social interaction, end up uncomfortable around lots of people, and so continue the cycle by living in isolated suburbs.
@@Zyo117 yes , it really is sad On the other hand, big cities have their problems too And by far not all "city kids" are good influences It really is confusing , makes one melancholic , that everything is so complicated.......
Oh man I pity your kid... When I was lil, I had to go spend time at grandma's for weeks sometimes, if my parents had to work extra. Since then, I've developed a profound hatred for villages and suburbs. I had a bunch of kids to play with in our block, but there was no one even near my age in the village and those were the unhappiest times of my childhood. Your wife put her whims above your child's needs, maybe consider having a talk with her about that. Villages suck and houses are nothing but pointless yard work+time wasted commuting to stuff you had right next door in the city. I would never live in a village/suburb again , even if you paid me. Do better by your child.
Being poor really sucks, doesn't it! If you would have worked harder when you were in school to get a USABLE education you would be in the group of people that live in the nice neighborhoods!
Genossenschaften are the #1 reason why Swiss cities are still affordable for the middle class. In Zurich, around 20% of households are Genossenschaften, this also means that landlords in the "free market" can't just charge exorbitant rents, because they still have to compete with the Genossenschaften. Of course the massive housing shortage still creates issues and rents are skyrocketing, but without Genossenschaften we'd have rents like San Francisco and NYC.
I disagree. The #1 reason why Switzerland has affordable housing is because Switzerland prioritizes building enough housing to fulfill demand. Co-operatives are indeed a good payment arrangement for some people. But the reason there are enough co-operative housing opportunities to go around hinges entirely on Switzerland’s extraordinarily aggressive housing construction policies.
@@tk80mufa5 Exactly. I mean at the outskirts in the not-so-nice areas. That’s a far better option than North America where it is common to not have any affordable housing within commute distance of jobs. In North America we just have wholesale shortfall of housing at any price. That is why the cheapest housing is unaffordable and we have many homeless.
@@alx9r my comment was directed at the first post , not you have you even been to Zurich recently and checked rent prices ? NA is like that also because it is larger than Europe , if there is a lot of free space , people tend to be more wasteful with that "resource". and let's not forget the elephant in the room - CRIME - also a huge reason why the US is so spatially separated. but with the US' negative influence on the EU & the world , we are gonna catch up in that regard rather quickly , but then unlike the US , there will be no more safe areas to retreat to.
I am from Greenland. I never have never rented an apartment, but only lived in dorms when I studied. After finished education I lived in my parents' home for 2 years then bought myself into Genossenschaft ("Andelsboligforening" in Danish). Now 4 years have passed, and I think this was the best decision I made.
I joined a cooperative housing association this year in Berlin. I waited less than a year and now I'm paying almost half the rent my friends are paying and we really have a nice apartment in a nice, tidy area much closer to the center than before. Almost all of the people in my building are seniors who are living in the same apartment for (no joke) 50 years, it's crazy. I really pushed us hard to join cooperative housing early, because I didn't want to go through the pain of searching an affordable apartment when we have children. We couldn't afford to move actually, but I pushed us to move anyway, as an investment in our future.
I am an American who recently moved to Germany. I actually think that this issue is one of the largest issues facing society today (the loss of community and the worldwide growing housing crisis) I have been a software developer and technical product manager for 15 years now, and I would absolutely love to work with anyone forwarding this cause, or building or assisting with creating co-ops. I recently saw a discussion between real estate developers in Minneapolis that an increase of 15-20% in rent prices still wouldn't cover the cost of building new housing units. Because it wouldn't be profitable to do so. Their solution? Government subsidies to builders and landlords. This is unsustainable for all of society, and we need to learn how to have personal communities again. Bring back the village in modern society.
America does have modern villages, they are called suburbs. The issue is that people were stupid enough to listen to the fear mongering of the media and now distrust their neighbours...
The situation in Minneapolis is quite literally their own doing. They passed RIDICULOUS anti landlord laws to that point that no sane developer would want to do business there and even smaller mom and pop set ups would want to exit the city. You can't create the most stringent laws making it impossible to do business in the country and then ask "why don't people want to invest millions of dollars to build here!?!?"
Coops here in the US are cheap only when the building was built 20+ years ago when it was cheap the debts mostly been paid off... If you build coops in the modern day, it's just as expensive as everything else until the building loan has been paid off... At this point, the only way to have access (in the far future I might add) is to just make every new building a coop reap the benefits 20+ years down the road. But we're terrible st forward thinking, so it'll never happen.
It isn't. The state build housing in the US is the same rip-off, and triggered the housing crisis of 2008, because the creditors (e.g. solid American private only-enlisted companies or German banks) had to take their losses, for having people basically live there for free. For example in Las Vegas. The State saved the money here, but the accelerating rent prices lead to increasing expendatures elsewhere for the public finances, because there was no solution til ~2018. Especially in (former) traditional-conservative areas like California or Florida had the prices increased for no real reason. The dumb are still those, who buy for inflated prices, in an politically egalitarian made setting without redlining and other things. The prices are just so high, because middleman aka gamblers put in their extra amount for every buying and selling, what also adds up the price. Atleast in Germany, the latter isn't that drastic, because the overall market still works and you don't have so much bad banks, filled with overpriced homes.
The assertion that co-operatives are somehow “non-capitalism” is bogus. The bulk of the capital risk, special skills, and high stakes decision-making still happens according to the usual capitalist practices. In fact, the co-operative members are essentially if not literally shareholders in that capitalist arrangement. Calling shareholders “members” doesn’t mean this isn’t capitalism.
You are in fact wrong. A consumer cooperative like a housing cooperative isn't just Socialist, but Anarchist, more specifically it falls under the Market Socialist ideology of Mutualism. Capitalism requires shareholders that own capital as that is the definition of Capitalism. Capitalism allows for external ownership of capital that can then be leveraged and used to buy more capital. Just because people think that Socialism is synonymous with with Authoritarian Marxism and Capitalism with Libertarian Free Market doesn't change the definition of the words. China is an Authoritarian Non Free Market Capitalist economy with the highest number of Fortune 500 companies and Spain has a Dustributist Socialist economy with Mondragon. Socialism is any economic system where the there is social ownership rather than the individual ownership that is in capitalism.
My grandparents have a flat in a Genossenschaft. Recently they got their first rent increase in like a decade, it's 25€. They pay 450€/month for their flat (iirc with utilities). I will never ever be in a situation where I'd pay such little for a roof over my head.
I pay 230 Euro a month for my flat, which I rented by an Genossenschaft also, around 10 years ago, with 50% reduced kaltmiete, due to 5th floor without elevator. A big factor is where you live. In my City [Halle (Saale)], you are still looking at 400-500 Euro (warm) a month for 50-60 m² 3 room flats, on the market. True I would earn more per month, if I would move to work into one of the expansive cities, but that would result in less money to spend overall, due to higher income tax and way higher rent prices. Which makes me wonder why people stay in these expansive cities, especially when homeoffice is on the raise and most craft professions need people all over germany. Depending on qualifications, it should be possible to find work everywhere in germany. And moving to a cheaper place could help a lot, to save money.
leider wahr. Leute verlangen in großstädten 1000€ fürn zimmer mit schimmelender tapete und man muss sich gefälligst anstellen. Aber hey während andere aus angst einfach durchgewunken werden, darf ich als deutscher (türkische eltern) natürlich 3 monate eine sperre bekommen weil man nicht drei monate vorher damit rechnete dass man die probezeit nicht besteht. (Achso natürlich lernt man sowas in der Schule 😜) Jetzt also drei monate fasten, oder tafel und zelt, kommt suppa bei neuen arbeitgebern, und zum glück ist ja noch sommer. Das mit mitte 20 und immerhin abitur, und keine alkohol oder drogen sucht. Danke Deutschland, für das stetige aufrechterhalten des ersten Grundgesetzes. PS. an alle braunen, es gibt nichts, kein anderes Land wohin ich „zurück“ kann.
@@actobot1337 Mit dem Bescheid über die Sperre vom ALG1 gehst du zum Jobcenter, welches für Bürgergeld (Ehemals ALG2) zuständig ist, inkl. vollständiger Unterlagen über deine aktuellen Finanzen, Mietvertrag etc. die Sperre von ALG1 schließt den Anspruch auf Bürgergeld nicht automatisch aus, kann aber ggf. ne 30% Kürzung vom Bürgergeld für die 3 Monate bedeuten, was immer noch Warmmiete+394 Euro wären, was i.d.R. reichen sollte. Und ja bei solchen Themen gibt es ne massive Bildungslücke im Schulsystem, aber immer wenn man den Mund aufmacht, um das Bildungssystem dahingehend zu kritisieren kommen Leute aus irgendwelchen Höhlen gekrochen mit dem Satz: "Das müssen einem halt die Eltern beibringen!"...
That's because we haven't ended the f...n housing market. We could switch to Cooperatives as the standard model. But instead the capitalism cultists still cling the invisible hand, that is squashing us slowly.
My first apartment in Hamburg was in a Wohnungsbaugenossenschaft. It was a bit crappy, tiny, but lovely and affortable. When my financial situation improved, I moved into a luxuriously big 1.5 bedroom apartment. Big enough for my then future husband to move in and we even stayed there when we had our first child. When our 2nd child was on her way we moved into a 3-bedroom-apartment, a newly built one, too. If it had no been for my wanting to live in the countryside, and my husband's job offer in a smaller city at that point, we could have stayed there forever.😊
My wife and lived in a coop in Queens NY the first 3 years of our marriage. When we had our twins, we were able to sell of shares to payoff our student loans and put a down payment on our current house. Sometimes wish we still lived in our coop if had more room instead of our house which is such a money pit. The only good thing about our house is its value since it doubled in the 7 years of living in it. Unfortunately, can’t sell it bc can’t afford the cost of other places now.
There are too many people who believe home appreciation is a good thing. Ultimately it only serves to drive up taxes and enrich realtors. A building that is decaying, built to standards and style or trends that are or will become obsolete. Land appreciates. A home is a liability, with ongoing maintenance, taxes, and modifications required to keep it going.
Factor in the repairs and maintenance and higher utility bills of a money pit and the “double in value” or price appreciation really doesn’t amount to much, I’d guess. I believe there have been some U.S. studies comparing the investment value of stocks versus a house (I.e. paying rent and investing savings in equities instead of homeownership). My recollection is that a house is not really a profitable “investment.” Own a home if you enjoy homeownership, but it’s-at best-a form of forced savings, not a moneymaking investment.
Some building cooperatives plan apartments, terraced houses, semi-detached houses for real rent-to-own. However, most building cooperatives usually act as landlords, even if you buy a cooperative share as a tenant. This share can also be inherited. On the free market, you usually throw a similar amount into the mouth of an estate agent + pay a deposit for the apartment owner. You now also pay an extra setup fee to the banks for this investment. Common rooms: these are often used for meetings, but can usually also be rented out to tenants for parties. Some cooperatives also allow these rooms to be rented out by third parties. In Hamburg, several cooperatives have joined forces to build some buildings in the Hafencity and many cooperatives now often use open spaces between existing buildings to add new buildings. These open spaces were planned rather generously in the 1960s/1970s and today additional houses can actually fit there and there is still green space and you can't hand your new neighbor coffee through the window :) However, the rent prices for the new buildings are also higher than in the older buildings. My sister-in-law had considered changing apartments, but she cannot afford to pay almost €300 more for a 15 square meter smaller apartment.
When my mother and I moved to NYC she bought into a co-op but later told me it was the crazy rules and restrictions that made her then sell up and move to a half house where she could also have a dog. For the very same reason dear friends of ours, here in Vienna moved from a large "Genossenschaftswohnung" to a house: they wanted to have dogs. They pay almost double now for all costs, and regret it a bit, but love their pets so much, they say it was worthwhile.
A lot of my colleagues in Vancouver live in them. We are librarians. They tell me these buildings are full of other public servants like teachers and nurses. But the wait list for them are full and getting into one can take many many years. It is a whole operation, almost like a second job just to find a spot in the distant future. This is a plaster, not a true long term solution.
Sounds like a business opportunity for someone to start building more of them. When the market has that much demand, it's ridiculous not to have someone trying to supply it.
Actually, Germany doesn't have a lack of homes. In fact, there are more than a million empty houses and apartments in Germany, many of them even in large cities. The problem is two-fold: firstly, the empty housing is not where the demand is - you find them in rural areas, starting around 50km away from the next bigger city with more than 100k citizens. Secondly, and that is especially true for empty housing in the bigger cities, many owners simply don't wont the hassle with renting out and decide to leave the home empty because its more convenient for them, especially when they already had experience with "bad" renters. Plus, and that is especially true for all the large cities with more than 500k citizens, much housing is not meant to be used as such by their owners, but have a sole function as financial assets (a.k.a. speculation), what demands much less costs and investments in administration and maintenance compared to renting out. This is mainly possible in Germany, because the housing tax is negligible here.
They can leave them vacant because the value keeps going up enough that renting them out isn't necessary. The value goes up because of a huge demand for housing. If the month over month or year over year value stayed flat or started going down they'd start considering renting them or maybe even selling
@@djsiii4737It's actually often illegal (for example, in Berlin), to leave them vacant. But that law is not enforced strictly enough, and the fines are far too low.
There is no empty house problem in Germany's bigger cities (but you are right, in the middle of nowhere, there is). Munich, Berlin and every other major and not so major city has no empty apartments. The rate (Leerstandsquote in German) is in Munich at 0.1% , in Berlin at 0.3%. This is clearly a myth, that a lot of owners leave their property "off market". It also would be very stupid, since the monthly costs for owners are quite high (a couple of hundred € for small apartments).
Well, you forgot that many empty homes are also too expensive, so no one takes them. I saw an old Apartment with 60 qm for 1000 Euro's in Bremen. It was actually so old, that living in it causes pain. Bad Internet connection, you could hear every neigbour, you could hear your washing machine everywhere, also mould everywhere. I pay for a complete new Apartment only 700 Euro's.
Want you say is true and a big problem in my city. We have around 70000 people and it’s been going downhill since the 90s. A lot of beautiful günderzeit blocks were sold as investment back then. The owners have never been here, have never done maintenance and don’t really care if the flats are rented out. Some have vanished, which is a problem when a house has to be demolished because of structural issues (that does happen every now and then). Of course with the state they are in everyone who can afford to live elsewhere will do that. And it’s really sad because these buildings are in the city centre so that is dying. Interestingly all renovated blocks are fully occupied, so the state of the buildings is most likely the main reason.
Where i live (southern germany), its around 400k for 80sqm flat, renting that would be around 1300-1600, a house is easily 700k+. if i move to the north, everything gets cheaper...BUT i would earn much less...so its basically the same problem. germany didnt solve anything, and we wont anytime soon.
@@bosiefoobar Du hast recht, der Norden besteht nur aus Berlin und Hamburg, und alle wollen nur in diesen 2 Städten leben, wie konnte ich so dumm sein. Reiß dich zusammen.
Same in Düsseldorf, flats start at 500k in decent areas and when u want to rent u need a lot of luck + 50qm flats go for 1k a month. And theres no one trying to solve anything, so i assume it will get much worse.
As a Mutualist, YES! Cooperatives are a great alternative to shareholder and government owned firms whether it's a housing consumer cooperative or a worker consumer cooperative. We need more Cooperatives!
Co-op living really suits me, I don't have to do things like mowing, tend to garden beds or do any building maintenance myself. It's done on volunteer basis, where people get compensated for the work they do (a part of what we pay into every month) and the stuff that doesn't get taken care of that way gets outsourced. No pressure, those who want to get some extra bucks can take on small jobs. Works really well.
In NYC and SF, co-ops have some of the highest fees and costs compared to condos. One explanation I've read is that co-ops are allowed to take out mortgages, unlike condos, and both are often mismanaged... So co-op disproportionately can end up going crazy on the spending, which translates to higher payments.
In the US at one time about 30-40 years ago, the US Govt had a cooperative program. I live in one of the cooperative apartments. They discontinued it for what reasons I don't know. But renters can come together and buyout their landlord and convert it into a cooperative. I'm surprised that the US Govt doesn't see co-ops as a solution to housing affordability.
@LCTesla We have lots of hyphenated words, especially when their meaning gets accentuated by it. It's optional grammatically, but not advised. Most of them, however, contain proper nouns. Most words, on the other hand, don't contain proper nouns.
Yes, I think the downside to those flats are long wait lists in bigger cities (at least a few years) and that you can't choose the location of a flat - just say yes or no - and wait longer. It is great for someone who knows he's staying somewhere for a long time. But they are too scarce in popular areas. For students and someone looking for limited time, probably not the best. We have the option of a WG (Wohngemeinschaft- shared flat) that can be great - depending mostly on the people living there. I do think the multi-storied houses with a garden for all can be good. And there's always the option of a patch of land in a "Schrebergarten" which are close by. The downside is always the rules you have to follow - and the neighbors you can't choose. But I had good experiences - my parents lived in one as we were younger. After we moved, we first chose the school we liked and then a nice flat with manageable commute for us kids with public traffic.
If you vote for left parties you can get more Genossenschaftswohnen, in Berlin Lichtenberg die Linke was in power till very recently, and that brought us a lot of new Genossenschafts projects instead of for profit land lords.
As a child in NYC in the 1970s my family moved into an income based co-op after years of being wait-listed. It definitely was the best place I lived growing up. Sadly, I heard that over time things went downhill at the co-op in terms of maintanence and quality of life due to poor management, conflicts, and ever growing costs. I ended up in a condo (in Colorado) that has the advantage of building considerably more equity than my parents were able to do in their lifetimes, with similar advantages of being more cost-effective albeit a bit less communal. However, now condos here are facing a crisis because most home insurance companies have pulled out of the condo market due to increasing fire risks with climate change (and two major wildfires in our state), leaving only "insurance of last resort" companies that charge astronomical fees and have been causing HOAs to double or triple fees, or charge unaffordable assessments.
There is a solution to fire insurance becoming unaffordable. Built better buildings. If you can document that the design, materials, and detailing of your building make it functionally fire proof, you will be able to find someone who will insure it at a lower premium.
We have them in Sweden too, they are called ”bostadsratt” and they are owned by the renters. They can be sold and bought but unfortunately they are getting very expensive now. Truly cooperative apartments are scarce and the other tenants have to ”vote you in” so it is often children or relatives to renters that get in. I would take a look at ”owner apartments” in Wienna, Austria. They are often bought by persons and rented out. Since there are an abundance of such apartments the competition makes them affordable (don’t know if latest immigration has changed it). Companies like Blackrock are not allowed to buy them as far as I know. Often ads are posted in the local store. My friend lives in a cooperative in Zurich, Switzerland and he contributes to the cooperative by running the local website where people can post comments or buying and selling stuff. But there are many ways to adress scarcity of apartments. In Switzerland when you build a house it has to include a studio that can be rented out. This means that there are a lot of small apartments for young people or single old people.
I would like to see the economics of this housing model explained fully. The coop has to pay the interest and principal on the loan, property taxes, maintenance, save for large capital improvements, property management, utilities, etc. and still offer share holders below market rents. Please do a follow up video with some mathematic explanations to go along side the trendy social rehtoric.
How does this work in high inflation years, where costs of operation are paid at market rates, but the rents do not compensate. Do they even break even.
Well, some of them try to grow. Depending on the co-op, some of them build new housing, and that allows them to charge higher rates for the newer building - hopefully clearing out old buildings and renewing them. But, in Germany, AFAIK federal and local governments are more than eager to subsidize these. As you can see the former, especially with democratic votes, can fail overtime, unless staying afloat is put above the needs of individual tenants (which will never happen)
My take is this: in a cooperative we want affordable housing and we get together to make that happen, we basically a non profit enterprise .A housing development or a condo is there for the developers to make money out of us, is a for profit enterprise. That's where the price/cost difference resides.
The U.S. has a notable number of housing co-ops, with around 1,200 in New Jersey and 8,000 in New York. Reviews are mixed: some co-ops are commended for their community and management, while others are criticized for having too many rules and issues with financial mismanagement
@@norbertkaut5396 Any human organisation will be messy. And usually that's OK, but occasionally it gets too messy and people get hurt. The only way to consistently get perfect order is by applying force, which is inhumane and the opposite of freedom. I'm not against good management, but be very very very wary of creating permanent power structures. When they start to rot, the fallout is much worse than if a more egalitarian society falls apart. What I mean is, consider the possible failure states when setting up an organization.
Non-ownership co-ops are much more financially stable than any other form of corporation. Your condominium is more likely to go bankrupt. When co-ops do fail, but usually sell out well after the building loan is paid. Your own capital is never at risk.
This video got me wondering about this subject so i did a little digging. Most of the early housing coops in the US were geared toward the wealthy and high income earners who could well afford it, but liked the amenities and the freedom from home ownership responsibilities that coops delivered. Interesting.
You need to separate ownership and non-ownership co-ops. The video misses this important point. The more affordable form of co-ops do have reputation for being “socialist” because of their association with the Rochdale weavers and as providing services for lower class people. They are often slandered as “subsidized”. This has a kernel of truth as they often require a guarantor for the initial building loan. Other co-ops are supposed to do this, but it is a very slow process. Many governments create programs to do this which speeds up the building.
A big disadvantage is that you sometimes have to be a member for a long time before you can be assigned a place to live. And most Wohnungsbaugenossenschaften are local or regional. If you have to move to another city, for whatever reason, you are not entitled to get a place there. The cooperation between Wohnungsbaugenossenschaften and the possibility to transfer a membership is very limited and not generally available. Otherwise, they are a very good idea, but not as popular as you have said.
Yes! Love the cooperative concept. In Chicago and NYC, they seem to be more affordable-older, mid-rise to high-rise buildings with many units, low entry costs-some under $100,000, and HOA fees comparable to affordable rent prices, $1200-1300/mo. In the PNW, where the concept is more recent, the buildings are newer, low-rise, with fewer units, the cost to buy a "share" is much more costly, with slightly lower HOA fees. Units cost $350,000 to just under $500,000 to purchase a share. In the newer, smaller coops, there is more land and members are required to help in the maintenance of the land, property, etc. In cities like Chicago and NYC, the coops tend to be older, mid-rise towers that offer more residences, without so much of the hands-on maintenance requirements. The HOA fees are higher in the older tower complexes, because owners are paying for someone else to do maintenance and upkeep. However, the cost to buy a share in one of these older coops is very, very affordable and HOAs tend to be several hundred dollars lower than rents in comparable apartments. The world needs more cooperatives, especially in the US!
Laws will have to change in the US, currently it doesn’t work because joining the cooperative makes you part owner in the coop. And if an co-owner stops paying rent you generally cannot evict them given current laws.
The answer to the question of how hard it is to evict or to remove a coop member from membership vary from U.S. state to state. I do not believe it is accurate to say it is inordinately difficult to evict a coop member who violates the coop rules in significant ways.
@@norbertkaut5396 it will depend how you set it up. But generally you cannot force someone to sell an asset they own unless you have a preceding claim to that asset like where it’s used as collateral for a loan. You could structure the Coop as a Corp and then the Corp rents to people, who just so happen to be owners. In which case you’d have traditional tenet agreements and evictions, but you probably couldn’t force people to sell their ownership in the Corp once they buy in unless they want to. So I could see it being a headache in either case.
This would be a great solution. Sadly, I just don’t see it happening. There are just too many rich developers and landlords making so much money off of the current housing crisis. Co-ops would provide competition that would force landlords to lower rents to stay competitive. Developers would be forced to sell property at a loss, which would be abhorrent to them. They will throw every lobbyist they can at the politicians to block any efforts to create co-ops, possibly even going so far as to making them outright illegal. Especially at the local level (local politicians are far easier to corrupt). Remember, these are people who don’t give two craps about housing affordability and homelessness. They don’t care that people are struggling to afford housing. We’ve created a rentier economy. High interest mortgage? More money into Wall Street pockets. Default on your loan? Pay loan default fees. Can’t afford a house? Pay rent to rent one. Can’t afford either to rent or own? There’s the bridge, go sleep under it. The psycopathic finacial elite would rather pay taxes on a police force to forcibly relocate the homeless to “someone elses problem” than do something meaningful that would make them less rich, like co-op housing. Remember the two rules of Neo Liberalism: Rule #1: Because Markets Rule #2: Go die!
I live in a PUD (Planned Urban Development) in which I not only own my unit but also the land under it. Of course that means it’s a row house. Our HOA is in a park like setting which creates a relaxing environment. It’s not perfect but an option worth thinking about.
There are two sides that deserve further consideration: financial model & community living. The financial model with being a resource for the “missing middle” housing (from 5-24 units) would fill a big gap in traditional lending, if non-residents could “invest” in the entity, & get a financial return along with access to facilities & the community. The community aspect can be accomplished with a separate landlord but it requires intentionality on both sides & the landLORD model is supported by laws that don’t support common non-financial “ownership”. Being able to have neighbors buy into the community without tenancy may be an opportunity to deescalate NIMBYs (no to all change by default) to nimbys (open minded but hesitant to change, typically TO them).
Emm, its like telling people, you could have invested in Tesla 20 years ago and be rich. the same way not a single housing cooperative is accepting members anymore. you could have been part of it 20 years ago.
Pretty good spelling of this german tongue breaker (basically you can expand any noun to infinity in german, it's crazy)! Well done 👍 greetings from a native speaker
Genossenschaften are great but unfortunately they are not the solution for the housing crisis in Germany. There are by far not enough of them and it becomes more and more impossible for them to build new affordable homes because building houses became way to expensive and it becomes harder and harder for them to buy building land for reasonable prices.
I guess a big difference between Germany and the US is also that renting homes or apartments is not for a fixed time. They are usally without any end date so no renewing your lease. Most of the time you cant even move out for 1 or 2 years in the beginning. In generell it is also quite hard for landlords to end your lease. So in most cases people move out because they want or need to and not because the landlord wants to This means that these co-ops are not as different to the "normal" renting market as it might seem at first
I live in a apartment of a housing cooperative and over time i bought more and more shares. And once per year i receive dividends high enough to compensate around 30% of my paid rents. I love it, hehe.
What you are living in is not a co-op according to the Rochdale principles. I know that in the USA the principles are often not followed. Co-ops are supposed to limit financial returns and limit one share to one member.
I read about it and that concept’s been around since the days of the German Empire. So if anybody says that it’s a socialist concept, Wilhelm II might need to have a word.
While Wilhelm II might need to have a word, Otto von Bismarck would need to have a couple of sentences. OTOH, both were flaming socialists by modern American standards.
If we can get past the red scare propaganda for just one second, could we just agree that the emphasis on talking care of each other is a better idea than rugged individualism? The isolationist approach of America has made it harder for us to organize and get things done because we have a shattered sense of community that has many frightened for no other reason than "it's Communist!" That's the price we're paying to fight off the ghost of communism. An utter inability to communicate and work together as a community.
My sense is that co-op's, in general, are a more democratic approach to ownership. Democracies in government are prized but in everyday living, not so much. Co-op's in the workplace and in the living space should be available to those who wish to be a part of one. As with any structure, there are pluses and minuses and the key to happiness, is fully understanding what those factors are. Not everyone would be happy in a co-op but there are plenty who would be. We live in an individual house (because of all our dogs and cats) but we do rent out our condos. We would not be able to have 8 dogs and 7 cats in a co-op. This was another good video on raising awareness which it seems to me is what your channel is all about. Keep up the good work, Ashton.
Coming from Europe, a couple of big points id like to comment on: First, at least in my bubble, the economic advantages of the Genossenschaften is the main reason why people want in, and the huge disadvantage are the long waiting lists where people try to get on those lists as soon as possible to, after years of waiting, get their flats. And lastly, most flats belong to huge organisations which are far less "we know each other and decide everything in regular meetings" and much closer to "normal" landlords.
We have them in Denmark too. We also have non-profit housing associations, these are selfowning institutions where the govt. initially just guaranteed the loans for them to take off, you rent an apartment or house from them, and take care of any garden there might be, and interior small stuff, it's organised into small divisions where the tenants have a board and an annual assembly to decide on things, including approving the annual rent increase, the institution has its own small administrative staff which is shared with a lot of other divisions, unless the division is huge, maintenance staff is also shared. Each division saves up for larger projects, like when windows needs to be changed or a new roof put up. It keeps rents as low as possible, and homes in good condition.
Hello from Denmark. Yes, we have them here in Denmark. They are very common. and I would like to add; there is no ideology associated with living like this. These are not "monasteries" for segments of the population with a strong political mindset. It is just a practical way of living like other ways of living.
one of my best friend's parents live in a co-op in Canada that is for older retired folks, they absolutely love it and couldn't be happier, I've visited them a couple times and all the people seem genuinely happy. I think they are great options and wish we had more of them in the US.
Probably true, especially with Corporate landlords but many Independent Landlords are just trying to cover their monthly expenses for having the real estate. Not sure Renters understand all the expenses required by the owner. Unfortunately, when their costs go up, so do the rents. They must pass it down to survive. This is a big issue and property taxes for example just went up 30% in my area. Sorry Renters, you’ll have to pay for things like that one way or another too.
For the coop housing I see in the Bay Area, the reluctance is due to the relative illiquidity of less familiar financing structure, which leads to less demand, which leads to less appreciation, which leads to less buyer interest, which leads to fewer lenders serving the category, which leads to more illiquidity. It’s a vicious feedback loop. For many in the Bay Area, we’re here to make money, more money than we can make just about anywhere else. Getting into high appreciation housing is part of the plan. Even people who struggle to afford housing want in on that appreciation track.
Don’t confuse the ownership co-ops with non-ownership co-ops. Non-ownership co-ops are capitalist, but originate with the Rochdale weavers: a workers’ organization. It is just that the return on that capital for a housing co-op is the useful value of the building, and never monetary. The value is the safe and comfortable home. Not always an apartment, but mostly so. Co-ops are just another form of corporation.
What you are naming as cooperative housing is probably the same as „soldzielnie” in Poland in (soviet-communism times) PRL, they still exists and i think started to build condos again in Poland. Yes they have much better shared Spaces and common courtyards, parks than housing build by developers
Things that need to happen first in US before housing prices fall: 1) Change zoning laws. 2) Block NIMBY challenges to multifamily buildings. 3) Remove private equity/Wall Street from buying up and investing in housing. They have cornered the market. 4) States embrace public housing and maintain it properly. Coops can help but it's a drop in the ocean compared to the above issues.
I have lived in two apartments from housing cooperatives - and still own shares of the second, as they hand out quite some interest if you do not live in one of their apartments. It is like a rental home here in Germany, but instead of a rent-deposit you buy shares. And if you move out and things need to be done because of you living there and not renovating properly (walls and windows, painting doors, too) or you did cause some damage beyond normal wear and tear - you forfeit those shares like you would a deposit. But if you move out and do not violate your contract conditions (and they are way more lenient over here anyways, for example fixing shelves to the wall and hanging pictures is always allowed, unless you drill so many holes that the wall resembles a swiss cheese) you can keep those shares as a kind of investment. The interest rate you get from that investment is usually over what you get from a savings account - and more secure.
In short: You can pool your money with others to buy or construct houses, then rent them out and earn returns from the dividends on the shares of the housing units you hold. So much for a non-capitalist solution...
Nope. What you are describing is a regular development corporation. Look up the Rochdale principles for co-operatives. There are many condominiums that call themselves co-ops but aren’t co-ops.
@@benjaminmoogk3531 "There are many condominiums that call themselves co-ops but aren’t true co-ops." Yeah, that’s what I’m saying. Even if something starts with good intentions, it will probably devolve into a real estate investment. I don’t quite get whether we are stating the same thing or if you have a different view on the topic. In that case, I’d like to know the resources on which you base your stance. I admit that I don’t know much about the "Rochdale Principles", but I’ll take the time to read up on them (or explore other media). If you could point me toward some resources, it would save me some time getting started.
I don’t think it would work in the USA. Biggest obstacle is the zoning. A nearly as big obstacle is the perceived „individuality“ and the scare of socialist = communist ideas and principles. Sadly, a large part of US society believes nowadays in such nonsense. (I say perceived because most homes are so-called „tract homes“ which don’t look identical on first sight, but basically are just a couple floor models with a bit different outside paint, eaves, fake balconies. Even the bathroom and kitchen furniture, drapes, light fixtures are pretty much identical.) Bye the way, I lived nearly 10 years of my life with my parents in a „GWG“ apartment (Gemeinnützige Wohnungsbau Gesellschaft) in Reutlingen, BW, then in rented flats/condos in Germany and in California (there was even 1 house in between which we lost shortly after purchase in the recession of the early 1980s), we’ve lived in a regular Eigentumswohnung in Germany for the last 30 years. I wish there would be much more „social housing“ and co-ops built in Germany, we’re lagging far behind. The “cheap housing” found in especially smaller towns in the former East Germany are, for the most part, in areas without much employment opportunities.
People still want to own a house as security for the future so that they have a place to live in retirement and dont have to worry that someone will kick them out or that they wont be able to pay the monthly fees.
Almost everyone who moves into my co-op lives their entire lives here. More renovations are oriented to making units safe for elderly members. Wider doors, grab bars in the bathroom, and that sort of thing. We now have several generations of members as the location and fees are unbeatable. I’ve see children grow up and have their own children here.
I've been living in my cooperative flat for 20+ years and happy with it. No risk of having to move because 1) the rent is quite low, and 2) it's written in my contract that the co-op *will not* end the rent from their side (unless i severely breach my contract of course). It's guaranteed that I can stay as long as I want. Nice peace of mind!
@@daniel-or6sb socialism is nonprofit democratic people owned housing, production, shopping, insurance etc. and doesn't have to be state owned, sometimes preferribly not.
@@daniel-or6sb Socialism IS compatible with an economy allowing for-profit-companies. Even in God's own country. And Coops have existed for decades, and served their owners and customers and employees well.
Priority to prior participants and waiting lists, rather than higher prices, is another way to translate scarcity. It's great for the lucky few, but people on the waiting list still need to pay for a supply that's just too limited. This system can be a way to increase supply, but in the end it's just more housing units we need, no matter how they get built.
@siemdecleyn3198, correct. And at the end of the day, even co-ops have to find the money, the real estate, the materials and the contractors to get anything built. And there the difference isn't all that much. Otherwise the boundary conditions are also the same, like mortgage rates, bureaucracy, NIMBY neighbours, you name it. It is not as if commercial developers were all about price gouging. If that was the case there would not be quite as many of them (at least in Germany) to go belly-up. On top, those touted low rents are all coming off the principal. For commercial landlords, private landlords and also for co-ops as well. When overregulated rock-bottom rents make mainenance impossible, something has to give eventually. Economics are a b****.
It's not "lucky" few. If you were alone you'd have to wait for luck to build you a personal home, a cooperative is a means to increase your luck. Not being allergic to "politics" is even more lucky, when an entire actual nation exists around you. US fed is no nation, they first of all don't have a Language Regultory Body, so they don't have a genuine native language. This leads to no genuine education, because you can't work with the population you HAVE, over dreaming about the diligent worker drones you WISH you had as neighbors. Every real nation faces problems like how to FORMALIZE the education of say, French Canadians. How do you formalize Latin Americans in America? Oh yeah, define them as "anti-american" like Semitic Arabs are defined "anti-semitic". And driven off the border. you can't even keep track of where the American continent stands when your federation claims otherwise, that ulike Asians and Aficans, Americans don't have a geographic home but only a theoretical one. Were a lot of people across the Sindhu river are not welcome, not even, if you ask Bureau of Indian Affairs. You starting to feel like the Iroquois were waiting to get lucky? ALLOWED a home by the AMERICAN fed?
The video goes out of its way to suggest that the way housing gets built matters. Homes are always going to be a significant expense; building quick, shoddily and without anyway of sustaining liveability is no answer. As for your statement about 'lucky few' it's hard to parse what you mean- there are nations where 80% of the population live in these legal structures....
@@lb9147 Lucky few as in there are waiting lists and priority for people who come from the neighborhood (another building from the same organisation). Everyone needs to live somewhere every night. The costs might be below market rate, but unlucky ones still need to pay market rate. The only way to decrease the market rate, is to change zoning and allow more housing to be built.
Co-ops in the US have fees that you have to pa, in many cases, they are as high as your mortgage. I wanted to buy in NY/NJ area and they are about 150k, but when you factor the HOA, you end up paying a monthly mortgage equivalent to a 350k house if not more. This is for older units, new units are far more expensive. Even if you think this is good, remember that the Co-op has to fix and the building and some assessment after 10, 20, 30 years, they can be in the millions. Look at what is happening in FL with condos. HOA's skyrocketed to have money in reserves and on top of that each unit needs to pay ~150k to pool all the money to make the fixes to the building and keeping it legal and safe. If your HOA or dues are low, have in mind that eventually you have to all the money at once to pay for maintenance that is needed. This is typically a cost many people do not account for and are surprised when they are due.
Yeah but the thing about those fees is they pay for the maintenance of the structure and the grounds. In the same way that rent is supposed to pay for all the maintenance of the building with a profit margin on top, Co-Op fees are supposed to cover all those maintenance expenses plus other things you don't necessarily think about like property tax and insurance. You probably have to pay something like renters insurance for the contents of your unit, but not for the structure. In a single family house you might end up paying less per month, but then you get stuck with a five-figure bill for a new roof after 10 or 20 years.
@@AlRoderick It shows that you don't own a home........maintenance happens all the time , and you know if you'll need a new roof in 3-5 years and have time to plan....!!!!!
I live in the US. We have co-op properties here. You own your portion of the land. These work best for modular/mobile home parks. The payment is extremely small. Taxes are much more affordable. You vote on improvements to shared properties.
The idea behind is known well from a great film 🎥, with Danna Reed and James Stewart. The Titel was "Its a wonderfull World" But as a Bank. Build by local people. The first Bank in Germany work like this was Raiffeisenbank. This ships over WW1 WW2 and last finance crisis...
2 differences between condos and condos, you own the unit in s condo drvrlopment, and condo boards don't veto sales to a particular buyets. FHa and The VA won't lend if condos still have the first right of refusal in their documents. And, being a cooperative doesn't change the market rate price of houding.
I don’t think the European-style housing co-operatives would ever work under common law. They’ll just degenerate into endless legal disputes where those who like that conflict end up with preferential treatment. The civil law system Europe uses is very resilient to that problem which is why Europe enjoys nice things like housing co-operatives and on-budget construction projects.
View from the UK. Firstly never heard of this model, sounds like a good idea. UK is very much sold on the dream of single family homes, but the rental market is toxic 6 month rolling terms, and effectively renters are paying the mortgage (they just can not afford a deposit so a renter is paying some else’s asset purchase) things must change. Developers also bank land and restrict building to keep prices high (I believe if land is not being developed it should be returned others for development to continue)
Condos in America aren’t any more affordable than the other overpriced options because, while the “purchase” price may be much lower,you are still on the hook for “fees” that add up to about the same as what renters are paying. To add insult to injury, the HOAs force fine print on everyone, to say that the “owner” has to also pay for whatever special projects and other fee increases that the HOA decides. Hard for such scams to generate any sense of community.
Coop housing with its shared ownership model would be probably be welcomed in a good number of the US communities opposed to multi-family housing but you could never get the zoning right as any reasonable multi-family building definition would also open the door to subsidized multi-family housing and its associated social issues. The resident of the towns with restrictive zoning just don’t want the hassle of the later. It basically comes down to people take better care of things like the coop building they own shares in than stuff someone else owns.
I've heard quite a bit about the zoning issue in the US. 70+% of land is zoned for single-family homes. 95% here in CA. But this co-op thing sounds like an actual solution. If developers can be confident in the financial return on these buildings, they'll find a way to change the zoning.
There isn't a massive shortage of homes in the US, they could fix the entire housing "shortage" tomorrow if they made it illegal for hedgefunds/investment funds/corporations to own residential housing. And break up the price fixing scheme landlords are doing across the country. Most apartments and condos are actually "empty" because those empty residential buildings are used to jack up rents for other people looking to rent. It's a fake supply issue, it's similar in the way that a few bussiness's control diamonds. If you make a supply scarce then you can jack up and price gouge prices. It's a fake problem.
Also, the open borders hurt the working poor. They rent those out to illegal immigrants by the square foot. They can man thousands a month for a shack by cramming 20 people in there.
The solution to this is also stupid easy and wouldn't require new laws. Double the cost of the property tax for every single residential block a company owns. Most cities/towns can do this at the state level without the need of federal involvement. Next, implement an empty residential tax. So if a company owns a condo building, jacks up rent on 100 units keeps 20 filled with the higher rates and 80 empty because no one can afford it, for every residential unit they have that isn't filled their tax increases per unit by 2% a year. Just these two changes would solve USA's housing crisis over night. Doesn't require federal laws or the chambers of power in the USA, can all be done at the state level.
Starting a possibly long comment... * rental terms other than "unlimited duration" are very uncommon in Germany. People don't move unless their living situation requires it. Evicting someone is also rather hard and has to have a good justification, e.g. if you own an apartment that you rent out you can tell the tenant to move out if you need the place for yourself. However, if you own more than five apartments, you can't any more (I think the assumtion is, you can afford to rent something else). If you're anything other than a human, this justification is invalid. What remains is serious misbehaviour of the tenant, e.g. non-payment of rent. * I grew up in an apartment in the Familienheim Co-Op in Freiburg. Sense of community? To a certain degree. Possibly we were lucky, the whole building (42 units) were only nice neighbors. Today, Familienheim has a waiting list of 6-7 years and (if I remember correctly) a share price of 4000 Euros. On the plus side, the rent is about 30% below average.
I looked into a co-op here where I live in Canada. Because you can't get a traditional mortgage, if you don't have hundreds of thousands of dollars in savings, or are selling a house to downsize, you can't afford to buy into a co-op. Many also don't permit pets.
We changed the bylaws during the pandemic to allow dogs. The biggest barrier is that governments stopped guaranteeing building loans thirty years ago. Land acquired for build new co-ops was sold off. So no new co-ops. The theory was that the free market would provide housing for all incomes. Most co-ops have closed their waiting lists because demand is so overwhelming.
That is easy, finance Investors pay higher price for ground. Next people need a money for a share. Than the people must be sateled in one Region. If you invest in a share, you had to wait a long time. In some Regions 10 year.. So Genossenschaften are a solution for middel class people. But this is a Part of a solution.
Basically people who do not stay currently in the co-opoerative pay a subsciption fee for the opportunity to enter the co-operative. Very impressive...
You need to ammend your statement about shortage of homes. It's actually a massive shortage of AFFORDABLE homes. That is key. Because in my city there are all kinds of homes being built, all kinds of condos being built all over the place. None of them are affordable, because the city wants the tax dollars and the builders don't want to make inexpensive homes. Everything is "luxury" or touted as that. It's a crime really. Ever since COVID, when people living in condos realized single family homes (SFH) were better, there has been a glut of expensive condos, and a shortage of SFH -- that people could afford to purchase. Add to that the greedy real estate world who got into the habit of "auctioning" off houses to the highest bidder and you have a recipe for disaster. People buying homes they cannot afford at prices that they will never pay off. This of course leaves older people who own homes and longer have children in them, stuck in their too big house because they cannot afford to get a smaller house - this preventing a family house going on the market. When a bungalow is just as expensive as a 5-bedroom home, you know there is a serious problem with greed.
What solution? The housing market is literally dead over here. Entire generations (pretty much everything younger than boomers) can´t and never will be able to afford a house. They completely stopped building social housing as well.
Greed has been, and continues to be a major driver of the housing crisis. As an aside, co-ops are fairly common in Canada. One thing that has helped to exacerbate the housing crisis in Canada is the fact that the Canada Mortgage and Housing Corporation (CMHC) stopped funding the construction of co-ops 30-odd years ago. CMHC is a federal government agency that is roughly analogous to FNMA in the US in terms of its function and purpose.
Most apartments are not from a Wohnungsbaugenossenschaft. Most of them have years long waiting lists. There is no chance to get an apartment tomorrow in my hometown. Some of them only take renters with a WBS, meaning only renters with a low income. I compared the salaries in Germany with the Salaries in Florida and California and the jobs I compared a paid about 5 times better in the US. From what I've seen it's a lot easier to buy a big house with a double garage and a nice garden in the US than in Germany. At the same time many things are cheaper in the US.
we have CO-OP housing in Canada but they have gone way out of favour due to LOW affordability in the 70s PLUS the "community" requiring pre vetting would be "neighbors" getting "famous" for ONLY letting in "people like them" the financial issue is in Canada if you BUY a home/condo YOU own 100% of the title to it and banks will lend 75% of the value with CMHC backstopping up to 95% done by buying the mortgages of the banks as investment assets and "fin tech" wizardry A CO-OP is a fractional ownership of a BUISNESS that happens to OWN and RUN a building and is considered an investment asset and banks will cover 55% ONLY requiring 45% of the value up front and the amount discount for a CO-OP does NOT cover the difference as the building as a whole and extension the CO-OP "company" was a "base" value equal to the building valuation
Co-op housing construction did not rely on for-profit construction companies. The housing co-op movement of the early 20th century was backed by unions and successive social democratic governments. The govt would provide land and subsidies and the union labor would be hired directly by the co-ops, cutting out any for-profit developers. The workers were basically building houses for themselves and their colleagues. With cheap land and in-house construction, co-ops can construct housing much more cheaply than the prices you are familiar with. Of course this was (and is) only possible with a big Eco-System and support from unions and governments
@@substanceandevidence My friend is a developer ....for the price of the Union workers for one home, he can build 3 homes with self employed workers ......!!!! let that sink in for a moment....!!!
Type Ashton is one of my favourite channels! The zoning-restrictions in the USA are kind of surprising - for "the land of the free - and brave" it really seems to forbid many good experiments with new solutions. Tell us more!!!
Das eigentliche Problem ist, das die Nachfrage auf dem wohnungsmarkt gegenüber Preissteigerungen nur eine geringe Elastizität aufweist, weil wohnen ein grundlegendes Bedürfnis ist. Anders ausgedrückt: wenn die mieten steigen, verzichten die davon betroffenen lieber auf andere güter und Dienstleistungen. Wohnen hat eine eine hohe Priorität. Das liberale Argument ist hier immer das die menschen ja wegziehen können. An sich stimmt das auch. Aber dabei wird gerne vergessen das menschen in städte ziehen, weil sie das "stadtleben" leben wollen. Das kann man nicht einfach mit einem umzug in die Pampa substituieren. Das ist nicht das gleiche wie wenn man von milch marke A auf milch marke B umsteigt. Zudem sind menschen durch ihre Anstellung und ihr soziales Umfeld an orte gebunden. Und das spiegelt sich eben auch in der geringen nachfrage Elastizität wieder. Deswegen halte ich den markt als primäres mittel der Allokation von wohnraum, für ungeeignet. Der marktmechanismus greift hier einfach nicht richtig, weil vermieter eine enorme Macht haben. Sie können die preise viel weiter als auf anderen märkten in die höhe treiben, ohne das die nachfrage einbricht. Und darunter leiden dann andere branchen, weil die menschen auf ihre Güter und Dienstleistungen verzichten.
I agree with Ashton on the Cooperative model as a solution to the housing crisis, but living in one allows me to experience some of the negatives. In the US one should use the tools of the National Association of Housing Cooperatives for success. It is too easy for a person or group to grab control of the cooperative.
You shouldn't have to be forced to be constantly bothered by your neighbors to have affordable housing! Housing is a human right & should be DECOMODIFIED.
What I still don’t understand is how you have the resources to bootstrap a housing coop. Like if people are already struggling to afford rent, how do you get a bunch of those struggling people and get them financing to build an apartment building? Slapping an LLC on a group doesn’t magically make them capable of getting loans. It seems like starting a coop would really only work with a group of people who have significant savings to invest. So your target demographic is people who are financially comfortable, just not well-off enough to buy property on their own. This doesn’t sound to me like a solution to the housing affordability problem, unless there is significant state investment in seeding housing coops.
I have been a member of a housing cooperative for 30 years and have lived in an apartment belonging to this cooperative for 25 years. The rent is low and the apartment is very nice and modern. I can't imagine anything better.
That's so cool. The whole program for housing is really cool in my opinion. I would love to see more. From what I gather it can be really tough to get one in my cities. But once you are in, it's great.
@@TypeAshton "But once you are in, it's great"
So basically homeownership as well. Sure a mortgage sucks but you build equity. Of course that's if you can ever get a foot in that ladder...
I’m curious, maybe skeptical, of the statement that home ownership is a cornerstone of building wealth in the U.S. Like car ownership, the costs are often not recognized, even hidden.
@@dealbreakerc Pretty much yes, it lowers the first step a fair bit but it still is there. At least as it currently work in Sweden.
I’m also curious about what it would take to increase the proportion of U.S. housing stock that is cooperative housing. It may take some government subsidies. It also may require more changes in thinking and in tenant culture in the U.S. certainly some U.S. regions are further along than others. People have examples? Any data on areas in the U.S. that have more coop housing than other areas? Where would a person find that data?
You're 100% right with every thing you're saying. And yet, there's one thing that's being overlooked here: there's a reason that's not taken into consideration here when it comes to why living in a multi-family house is so unpopular in the US. And I myself only understood and all too well after having stayed in such a multi-apartment building in the Bay Area with a friend for a while.
In Germany I've lived in these kind of buildings for the last five decades and was never much bothered by living wall-to-wall with other people and families. Why?
Simply because the way German houses are build it ensures your sound privacy even when living in tiny apartments. You simply don't hear your neighbors or if you do, it's some undistinctive muffled noise and maybe some childrens laughter every once in a while.
I was flabbergasted when I realized that I overheard every, and I mean EVERY word my friend's neighbor was saying in his flat next door during the entire day while he was working from home and in such clarity, that I could've recorded it on tape. And no, he wasn't yelling. Just normal conversation with his partner or on the phone.
I would clearly not want to live in a place where nothing I say stays within my own walls, no matter how affordable it is!
So unless the US house building upgrades from cardboard walls to something more soundproof (and sturdy and durable), I can see why people prefer to have a bit more distance between them and the people next door.
Yes you are quite right about that. Germans have thick walls. Even in my German flat, I cannot hear the nearby train when it comes by if the window is closed. American construction quality is poor. Unfortunately, you have to ask Americans to build something that lasts and we are not good at that yet. We are too focused on "aesthetics" like how the lawn looks or exterior/interior design over good quality materials.
Meh. It varies. One condo I had in the US had such good soundproofing that I couldn’t hear the musician next door when he practiced his guitar. Never heard any sound from either of the adjacent units.
There are soundproof co-ops in nyc, but they are some of the most expensive units on the market
Another thing about co-ops is that the fee that you have to pay is in many cases as high as your mortgage. I wanted to buy in NY/NJ area and they are about 150k, but when you factor the HOA, you end up paying a monthly mortgage equivalent to a 350k house if not more. This is for older units, new units are far more expensive. Even if you think this is good, remember that the Co-op has to fix and the building and some assessment after 10, 20, 30 years can be in the millions. Look at what is happening in FL with condos. HOA's skyrocketed to have money in reserves and on top of that each unit needs to pay ~150k to pool all the money to make the fixes to the building and keeping it legal, and safe.
100% agree. I lived in Germany as a child and never heard our neighbors. The most quiet multi-housing unit I’ve ever lived in. Even outside was quiet. Moved back to the US for college and everything is loud and noisy. Not to mention the high crime rates. Tschüss
I live in Germany, those buildings are rare and the crisis is bad honestly. For students a private room in a shared apartment between 3/5 people goes for 600 usually if you live in a city. Its low-key almost unaffordable
Isn't it funny how it is always ALMOST unaffordable? It is as if it was planned...
@@TheBrazilRulesand now; all the illegals get their rent paid whilst u as a student are told to F off 😂
You probably live in the west then. That sounds like Berlin or Munich prices to me. Over here in the East the situation is better, though not entirely perfect either. While the Genossenschaften are fairly large and the housing affordable, private Scum like Vonovia is busy squeezing every bit of money out of their rentera here too.
@@TheBrazilRules In most cases, the public pays for it. First in subsidizing it, because it is "necessary" to have "housing". After it is finished, you have mostly migrants with connections living there through the "social system", often with no backgroundchecks who actually lives there. It's mostly a thing in left-wing ruled cities or university cities. So, it's expensive, because others will pay for it.
I'd argue that is an infrastructure issue.
Obviously universities can't be everywhere but having local shops and some amount of internet and entertainment would make the village my grandmother was raised in viable to return to.
I used to live like that. I paid €300 per month with free water, heat and electricity for a fairly big apartment. However I sold it for a house and now I pay that much for electricity alone thanks to high energy prices in recent years in Europe. Even water has gone from 30 bucks a month in 2022 to 70 bucks a month. These inflation years would have been so much easier if we still lived there. But my wife really wanted a house. But it’s me that has to mown the lawn and take out weee in the harder and oil the veranda. I do love not to have to worry about neighbours and having a veranda but it’s no denying the coop apartment was extremely cheap. We even had solar panels on the apartment buildings and we had just renovated the bathroom kitchen and the kid had other kids to play with. Here the only neighbours are pensioners. In the coop they had just put new playgrounds. We had several very nice playgrounds. Now we only have a trampoline and some swings in our yard and no other kids come to play so they barely get used. I think it might have been best to have the apartment but then a summer house for when you feel like you want your own space.
That, but on a massive scale is probably why north America is the way that it is. Kids grow up isolated, don't get much social interaction, end up uncomfortable around lots of people, and so continue the cycle by living in isolated suburbs.
@@Zyo117 yes , it really is sad
On the other hand, big cities have their problems too
And by far not all "city kids" are good influences
It really is confusing , makes one melancholic , that everything is so complicated.......
Oh man I pity your kid... When I was lil, I had to go spend time at grandma's for weeks sometimes, if my parents had to work extra. Since then, I've developed a profound hatred for villages and suburbs. I had a bunch of kids to play with in our block, but there was no one even near my age in the village and those were the unhappiest times of my childhood.
Your wife put her whims above your child's needs, maybe consider having a talk with her about that. Villages suck and houses are nothing but pointless yard work+time wasted commuting to stuff you had right next door in the city. I would never live in a village/suburb again , even if you paid me. Do better by your child.
Being poor really sucks, doesn't it! If you would have worked harder when you were in school to get a USABLE education you would be in the group of people that live in the nice neighborhoods!
@@glasslinger
👍
Sometimes the truth hurts.
Genossenschaften are the #1 reason why Swiss cities are still affordable for the middle class. In Zurich, around 20% of households are Genossenschaften, this also means that landlords in the "free market" can't just charge exorbitant rents, because they still have to compete with the Genossenschaften. Of course the massive housing shortage still creates issues and rents are skyrocketing, but without Genossenschaften we'd have rents like San Francisco and NYC.
I disagree. The #1 reason why Switzerland has affordable housing is because Switzerland prioritizes building enough housing to fulfill demand.
Co-operatives are indeed a good payment arrangement for some people. But the reason there are enough co-operative housing opportunities to go around hinges entirely on Switzerland’s extraordinarily aggressive housing construction policies.
Zurich affordable for the middle class ? are you serious? you mean at the very outskirts in the not so nice areas , surely ?
@@tk80mufa5 Exactly. I mean at the outskirts in the not-so-nice areas. That’s a far better option than North America where it is common to not have any affordable housing within commute distance of jobs.
In North America we just have wholesale shortfall of housing at any price. That is why the cheapest housing is unaffordable and we have many homeless.
Buying home is insanely expensive in Switzerland
@@alx9r my comment was directed at the first post , not you
have you even been to Zurich recently and checked rent prices ?
NA is like that also because it is larger than Europe , if there is a lot of free space , people tend to be more wasteful with that "resource".
and let's not forget the elephant in the room - CRIME - also a huge reason why the US is so spatially separated.
but with the US' negative influence on the EU & the world , we are gonna catch up in that regard rather quickly , but then unlike the US , there will be no more safe areas to retreat to.
I am from Greenland. I never have never rented an apartment, but only lived in dorms when I studied. After finished education I lived in my parents' home for 2 years then bought myself into Genossenschaft ("Andelsboligforening" in Danish). Now 4 years have passed, and I think this was the best decision I made.
I joined a cooperative housing association this year in Berlin. I waited less than a year and now I'm paying almost half the rent my friends are paying and we really have a nice apartment in a nice, tidy area much closer to the center than before. Almost all of the people in my building are seniors who are living in the same apartment for (no joke) 50 years, it's crazy. I really pushed us hard to join cooperative housing early, because I didn't want to go through the pain of searching an affordable apartment when we have children. We couldn't afford to move actually, but I pushed us to move anyway, as an investment in our future.
I wonder which Wohnungsbaugenossenschaft in Berlin still accept new members without connections nowadays.
@@summak WBG Treptow Nord
I am an American who recently moved to Germany. I actually think that this issue is one of the largest issues facing society today (the loss of community and the worldwide growing housing crisis)
I have been a software developer and technical product manager for 15 years now, and I would absolutely love to work with anyone forwarding this cause, or building or assisting with creating co-ops.
I recently saw a discussion between real estate developers in Minneapolis that an increase of 15-20% in rent prices still wouldn't cover the cost of building new housing units. Because it wouldn't be profitable to do so. Their solution? Government subsidies to builders and landlords.
This is unsustainable for all of society, and we need to learn how to have personal communities again. Bring back the village in modern society.
America does have modern villages, they are called suburbs. The issue is that people were stupid enough to listen to the fear mongering of the media and now distrust their neighbours...
as a kind of structure within a city? sounds nice
Insights as to whether these cooperatives have many of the same problems that HOA haters in the US dislike?
The situation in Minneapolis is quite literally their own doing. They passed RIDICULOUS anti landlord laws to that point that no sane developer would want to do business there and even smaller mom and pop set ups would want to exit the city.
You can't create the most stringent laws making it impossible to do business in the country and then ask "why don't people want to invest millions of dollars to build here!?!?"
Coops here in the US are cheap only when the building was built 20+ years ago when it was cheap the debts mostly been paid off...
If you build coops in the modern day, it's just as expensive as everything else until the building loan has been paid off...
At this point, the only way to have access (in the far future I might add) is to just make every new building a coop reap the benefits 20+ years down the road.
But we're terrible st forward thinking, so it'll never happen.
It isn't. The state build housing in the US is the same rip-off, and triggered the housing crisis of 2008, because the creditors (e.g. solid American private only-enlisted companies or German banks) had to take their losses, for having people basically live there for free. For example in Las Vegas. The State saved the money here, but the accelerating rent prices lead to increasing expendatures elsewhere for the public finances, because there was no solution til ~2018. Especially in (former) traditional-conservative areas like California or Florida had the prices increased for no real reason. The dumb are still those, who buy for inflated prices, in an politically egalitarian made setting without redlining and other things. The prices are just so high, because middleman aka gamblers put in their extra amount for every buying and selling, what also adds up the price. Atleast in Germany, the latter isn't that drastic, because the overall market still works and you don't have so much bad banks, filled with overpriced homes.
The assertion that co-operatives are somehow “non-capitalism” is bogus.
The bulk of the capital risk, special skills, and high stakes decision-making still happens according to the usual capitalist practices. In fact, the co-operative members are essentially if not literally shareholders in that capitalist arrangement.
Calling shareholders “members” doesn’t mean this isn’t capitalism.
True.
You are in fact wrong. A consumer cooperative like a housing cooperative isn't just Socialist, but Anarchist, more specifically it falls under the Market Socialist ideology of Mutualism.
Capitalism requires shareholders that own capital as that is the definition of Capitalism. Capitalism allows for external ownership of capital that can then be leveraged and used to buy more capital. Just because people think that Socialism is synonymous with with Authoritarian Marxism and Capitalism with Libertarian Free Market doesn't change the definition of the words.
China is an Authoritarian Non Free Market Capitalist economy with the highest number of Fortune 500 companies and Spain has a Dustributist Socialist economy with Mondragon.
Socialism is any economic system where the there is social ownership rather than the individual ownership that is in capitalism.
100% we've let landlords take the term capitalism when early capitalists were very anti landlord like Adam Smith
@@gljames24 Average socialist writing walls of text when someone mentions capitalism
She's just a typical American.
My grandparents have a flat in a Genossenschaft.
Recently they got their first rent increase in like a decade, it's 25€. They pay 450€/month for their flat (iirc with utilities).
I will never ever be in a situation where I'd pay such little for a roof over my head.
I pay 230 Euro a month for my flat, which I rented by an Genossenschaft also, around 10 years ago, with 50% reduced kaltmiete, due to 5th floor without elevator.
A big factor is where you live. In my City [Halle (Saale)], you are still looking at 400-500 Euro (warm) a month for 50-60 m² 3 room flats, on the market.
True I would earn more per month, if I would move to work into one of the expansive cities, but that would result in less money to spend overall, due to higher income tax and way higher rent prices. Which makes me wonder why people stay in these expansive cities, especially when homeoffice is on the raise and most craft professions need people all over germany. Depending on qualifications, it should be possible to find work everywhere in germany. And moving to a cheaper place could help a lot, to save money.
leider wahr. Leute verlangen in großstädten 1000€ fürn zimmer mit schimmelender tapete und man muss sich gefälligst anstellen. Aber hey während andere aus angst einfach durchgewunken werden, darf ich als deutscher (türkische eltern) natürlich 3 monate eine sperre bekommen weil man nicht drei monate vorher damit rechnete dass man die probezeit nicht besteht. (Achso natürlich lernt man sowas in der Schule 😜) Jetzt also drei monate fasten, oder tafel und zelt, kommt suppa bei neuen arbeitgebern, und zum glück ist ja noch sommer. Das mit mitte 20 und immerhin abitur, und keine alkohol oder drogen sucht. Danke Deutschland, für das stetige aufrechterhalten des ersten Grundgesetzes.
PS. an alle braunen, es gibt nichts, kein anderes Land wohin ich „zurück“ kann.
@@actobot1337 Mit dem Bescheid über die Sperre vom ALG1 gehst du zum Jobcenter, welches für Bürgergeld (Ehemals ALG2) zuständig ist, inkl. vollständiger Unterlagen über deine aktuellen Finanzen, Mietvertrag etc. die Sperre von ALG1 schließt den Anspruch auf Bürgergeld nicht automatisch aus, kann aber ggf. ne 30% Kürzung vom Bürgergeld für die 3 Monate bedeuten, was immer noch Warmmiete+394 Euro wären, was i.d.R. reichen sollte.
Und ja bei solchen Themen gibt es ne massive Bildungslücke im Schulsystem, aber immer wenn man den Mund aufmacht, um das Bildungssystem dahingehend zu kritisieren kommen Leute aus irgendwelchen Höhlen gekrochen mit dem Satz: "Das müssen einem halt die Eltern beibringen!"...
I just clicked on this video to tell you guys that Germany is far from any “solution” to the housing crisis
🤣🤣🤣
That's because we haven't ended the f...n housing market. We could switch to Cooperatives as the standard model. But instead the capitalism cultists still cling the invisible hand, that is squashing us slowly.
My first apartment in Hamburg was in a Wohnungsbaugenossenschaft. It was a bit crappy, tiny, but lovely and affortable. When my financial situation improved, I moved into a luxuriously big 1.5 bedroom apartment. Big enough for my then future husband to move in and we even stayed there when we had our first child. When our 2nd child was on her way we moved into a 3-bedroom-apartment, a newly built one, too. If it had no been for my wanting to live in the countryside, and my husband's job offer in a smaller city at that point, we could have stayed there forever.😊
My wife and lived in a coop in Queens NY the first 3 years of our marriage. When we had our twins, we were able to sell of shares to payoff our student loans and put a down payment on our current house. Sometimes wish we still lived in our coop if had more room instead of our house which is such a money pit. The only good thing about our house is its value since it doubled in the 7 years of living in it. Unfortunately, can’t sell it bc can’t afford the cost of other places now.
There are too many people who believe home appreciation is a good thing. Ultimately it only serves to drive up taxes and enrich realtors. A building that is decaying, built to standards and style or trends that are or will become obsolete. Land appreciates. A home is a liability, with ongoing maintenance, taxes, and modifications required to keep it going.
Factor in the repairs and maintenance and higher utility bills of a money pit and the “double in value” or price appreciation really doesn’t amount to much, I’d guess. I believe there have been some U.S. studies comparing the investment value of stocks versus a house (I.e. paying rent and investing savings in equities instead of homeownership). My recollection is that a house is not really a profitable “investment.” Own a home if you enjoy homeownership, but it’s-at best-a form of forced savings, not a moneymaking investment.
Some building cooperatives plan apartments, terraced houses, semi-detached houses for real rent-to-own.
However, most building cooperatives usually act as landlords, even if you buy a cooperative share as a tenant. This share can also be inherited. On the free market, you usually throw a similar amount into the mouth of an estate agent + pay a deposit for the apartment owner. You now also pay an extra setup fee to the banks for this investment.
Common rooms: these are often used for meetings, but can usually also be rented out to tenants for parties. Some cooperatives also allow these rooms to be rented out by third parties.
In Hamburg, several cooperatives have joined forces to build some buildings in the Hafencity and many cooperatives now often use open spaces between existing buildings to add new buildings.
These open spaces were planned rather generously in the 1960s/1970s and today additional houses can actually fit there and there is still green space and you can't hand your new neighbor coffee through the window :)
However, the rent prices for the new buildings are also higher than in the older buildings.
My sister-in-law had considered changing apartments, but she cannot afford to pay almost €300 more for a 15 square meter smaller apartment.
When my mother and I moved to NYC she bought into a co-op but later told me it was the crazy rules and restrictions that made her then sell up and move to a half house where she could also have a dog.
For the very same reason dear friends of ours, here in Vienna moved from a large "Genossenschaftswohnung" to a house: they wanted to have dogs. They pay almost double now for all costs, and regret it a bit, but love their pets so much, they say it was worthwhile.
A lot of my colleagues in Vancouver live in them. We are librarians. They tell me these buildings are full of other public servants like teachers and nurses. But the wait list for them are full and getting into one can take many many years. It is a whole operation, almost like a second job just to find a spot in the distant future. This is a plaster, not a true long term solution.
Sounds like a business opportunity for someone to start building more of them. When the market has that much demand, it's ridiculous not to have someone trying to supply it.
Actually, Germany doesn't have a lack of homes. In fact, there are more than a million empty houses and apartments in Germany, many of them even in large cities. The problem is two-fold: firstly, the empty housing is not where the demand is - you find them in rural areas, starting around 50km away from the next bigger city with more than 100k citizens. Secondly, and that is especially true for empty housing in the bigger cities, many owners simply don't wont the hassle with renting out and decide to leave the home empty because its more convenient for them, especially when they already had experience with "bad" renters. Plus, and that is especially true for all the large cities with more than 500k citizens, much housing is not meant to be used as such by their owners, but have a sole function as financial assets (a.k.a. speculation), what demands much less costs and investments in administration and maintenance compared to renting out. This is mainly possible in Germany, because the housing tax is negligible here.
They can leave them vacant because the value keeps going up enough that renting them out isn't necessary. The value goes up because of a huge demand for housing. If the month over month or year over year value stayed flat or started going down they'd start considering renting them or maybe even selling
@@djsiii4737It's actually often illegal (for example, in Berlin), to leave them vacant. But that law is not enforced strictly enough, and the fines are far too low.
There is no empty house problem in Germany's bigger cities (but you are right, in the middle of nowhere, there is). Munich, Berlin and every other major and not so major city has no empty apartments. The rate (Leerstandsquote in German) is in Munich at 0.1% , in Berlin at 0.3%. This is clearly a myth, that a lot of owners leave their property "off market". It also would be very stupid, since the monthly costs for owners are quite high (a couple of hundred € for small apartments).
Well, you forgot that many empty homes are also too expensive, so no one takes them. I saw an old Apartment with 60 qm for 1000 Euro's in Bremen. It was actually so old, that living in it causes pain. Bad Internet connection, you could hear every neigbour, you could hear your washing machine everywhere, also mould everywhere. I pay for a complete new Apartment only 700 Euro's.
Want you say is true and a big problem in my city. We have around 70000 people and it’s been going downhill since the 90s. A lot of beautiful günderzeit blocks were sold as investment back then. The owners have never been here, have never done maintenance and don’t really care if the flats are rented out. Some have vanished, which is a problem when a house has to be demolished because of structural issues (that does happen every now and then). Of course with the state they are in everyone who can afford to live elsewhere will do that. And it’s really sad because these buildings are in the city centre so that is dying. Interestingly all renovated blocks are fully occupied, so the state of the buildings is most likely the main reason.
Where i live (southern germany), its around 400k for 80sqm flat, renting that would be around 1300-1600, a house is easily 700k+.
if i move to the north, everything gets cheaper...BUT i would earn much less...so its basically the same problem.
germany didnt solve anything, and we wont anytime soon.
Amen!
Indeed - there are far too few housing coops - the price isn't driven down sufficiently
Yep, Berlin and Hamburg are super cheap ;)
@@bosiefoobar Du hast recht, der Norden besteht nur aus Berlin und Hamburg, und alle wollen nur in diesen 2 Städten leben, wie konnte ich so dumm sein.
Reiß dich zusammen.
Same in Düsseldorf, flats start at 500k in decent areas and when u want to rent u need a lot of luck + 50qm flats go for 1k a month. And theres no one trying to solve anything, so i assume it will get much worse.
As a Mutualist, YES! Cooperatives are a great alternative to shareholder and government owned firms whether it's a housing consumer cooperative or a worker consumer cooperative. We need more Cooperatives!
Co-op living really suits me, I don't have to do things like mowing, tend to garden beds or do any building maintenance myself. It's done on volunteer basis, where people get compensated for the work they do (a part of what we pay into every month) and the stuff that doesn't get taken care of that way gets outsourced. No pressure, those who want to get some extra bucks can take on small jobs. Works really well.
In NYC and SF, co-ops have some of the highest fees and costs compared to condos. One explanation I've read is that co-ops are allowed to take out mortgages, unlike condos, and both are often mismanaged... So co-op disproportionately can end up going crazy on the spending, which translates to higher payments.
In the US at one time about 30-40 years ago, the US Govt had a cooperative program. I live in one of the cooperative apartments. They discontinued it for what reasons I don't know. But renters can come together and buyout their landlord and convert it into a cooperative. I'm surprised that the US Govt doesn't see co-ops as a solution to housing affordability.
When one buys a home with a mortgage, the person doesn't own property. The person just owns the liability.
The person owns the difference between the value of the property and the liability, and that difference grows every year.
Wohnungsbaugenossenschaft Apartments are barely to find...
Lets be honest people... stay with your parents or buy a tent. Thats what it is
somebody please teach germany how to hyphenate words
@LCTesla We have lots of hyphenated words, especially when their meaning gets accentuated by it. It's optional grammatically, but not advised. Most of them, however, contain proper nouns. Most words, on the other hand, don't contain proper nouns.
@@LCTesla im sorry your language doesnt have the feature of constructing new words from old words =P
Yes, I think the downside to those flats are long wait lists in bigger cities (at least a few years) and that you can't choose the location of a flat - just say yes or no - and wait longer.
It is great for someone who knows he's staying somewhere for a long time.
But they are too scarce in popular areas.
For students and someone looking for limited time, probably not the best.
We have the option of a WG (Wohngemeinschaft- shared flat) that can be great - depending mostly on the people living there.
I do think the multi-storied houses with a garden for all can be good. And there's always the option of a patch of land in a "Schrebergarten" which are close by.
The downside is always the rules you have to follow - and the neighbors you can't choose. But I had good experiences - my parents lived in one as we were younger.
After we moved, we first chose the school we liked and then a nice flat with manageable commute for us kids with public traffic.
If you vote for left parties you can get more Genossenschaftswohnen, in Berlin Lichtenberg die Linke was in power till very recently, and that brought us a lot of new Genossenschafts projects instead of for profit land lords.
I live in a co-op like this. I love it. It's great, we collectively decide how we want our building to be.
As a child in NYC in the 1970s my family moved into an income based co-op after years of being wait-listed. It definitely was the best place I lived growing up. Sadly, I heard that over time things went downhill at the co-op in terms of maintanence and quality of life due to poor management, conflicts, and ever growing costs. I ended up in a condo (in Colorado) that has the advantage of building considerably more equity than my parents were able to do in their lifetimes, with similar advantages of being more cost-effective albeit a bit less communal. However, now condos here are facing a crisis because most home insurance companies have pulled out of the condo market due to increasing fire risks with climate change (and two major wildfires in our state), leaving only "insurance of last resort" companies that charge astronomical fees and have been causing HOAs to double or triple fees, or charge unaffordable assessments.
There is a solution to fire insurance becoming unaffordable. Built better buildings. If you can document that the design, materials, and detailing of your building make it functionally fire proof, you will be able to find someone who will insure it at a lower premium.
We have them in Sweden too, they are called ”bostadsratt” and they are owned by the renters. They can be sold and bought but unfortunately they are getting very expensive now. Truly cooperative apartments are scarce and the other tenants have to ”vote you in” so it is often children or relatives to renters that get in. I would take a look at ”owner apartments” in Wienna, Austria. They are often bought by persons and rented out. Since there are an abundance of such apartments the competition makes them affordable (don’t know if latest immigration has changed it). Companies like Blackrock are not allowed to buy them as far as I know. Often ads are posted in the local store. My friend lives in a cooperative in Zurich, Switzerland and he contributes to the cooperative by running the local website where people can post comments or buying and selling stuff. But there are many ways to adress scarcity of apartments. In Switzerland when you build a house it has to include a studio that can be rented out. This means that there are a lot of small apartments for young people or single old people.
I would like to see the economics of this housing model explained fully. The coop has to pay the interest and principal on the loan, property taxes, maintenance, save for large capital improvements, property management, utilities, etc. and still offer share holders below market rents. Please do a follow up video with some mathematic explanations to go along side the trendy social rehtoric.
How does this work in high inflation years, where costs of operation are paid at market rates, but the rents do not compensate. Do they even break even.
Well, some of them try to grow. Depending on the co-op, some of them build new housing, and that allows them to charge higher rates for the newer building - hopefully clearing out old buildings and renewing them.
But, in Germany, AFAIK federal and local governments are more than eager to subsidize these.
As you can see the former, especially with democratic votes, can fail overtime, unless staying afloat is put above the needs of individual tenants (which will never happen)
Stakeholders, not shareholders.
@@gljames24 same difference
My take is this: in a cooperative we want affordable housing and we get together to make that happen, we basically a non profit enterprise .A housing development or a condo is there for the developers to make money out of us, is a for profit enterprise. That's where the price/cost difference resides.
The U.S. has a notable number of housing co-ops, with around 1,200 in New Jersey and 8,000 in New York. Reviews are mixed: some co-ops are commended for their community and management, while others are criticized for having too many rules and issues with financial mismanagement
Any good organization needs good management and oversight. That’s part of having a successful community.
@@norbertkaut5396 Any human organisation will be messy. And usually that's OK, but occasionally it gets too messy and people get hurt. The only way to consistently get perfect order is by applying force, which is inhumane and the opposite of freedom. I'm not against good management, but be very very very wary of creating permanent power structures. When they start to rot, the fallout is much worse than if a more egalitarian society falls apart.
What I mean is, consider the possible failure states when setting up an organization.
I pay 350 EUR, 65m2, no utilities. Given my income, it is so stupid cheap, alone that makes working in other cities unattractive.
Where do you live?
@@TASCOLP A medium size city north of germany.
@@Fernando31611 I wish we had prices like this in the city where I live (Frankfurt am Main).
@@TASCOLP FRA is so full of bankers I think they actually print the money there.
Co-ops do go bankrupt and many are under insured. And the share owners are left holding the bag.
Non-ownership co-ops are much more financially stable than any other form of corporation. Your condominium is more likely to go bankrupt. When co-ops do fail, but usually sell out well after the building loan is paid. Your own capital is never at risk.
This video got me wondering about this subject so i did a little digging. Most of the early housing coops in the US were geared toward the wealthy and high income earners who could well afford it, but liked the amenities and the freedom from home ownership responsibilities that coops delivered. Interesting.
You need to separate ownership and non-ownership co-ops. The video misses this important point. The more affordable form of co-ops do have reputation for being “socialist” because of their association with the Rochdale weavers and as providing services for lower class people. They are often slandered as “subsidized”. This has a kernel of truth as they often require a guarantor for the initial building loan. Other co-ops are supposed to do this, but it is a very slow process. Many governments create programs to do this which speeds up the building.
I remember back in the housing collapse of 2008 banks bulldozing homes they couldn't sell. Probably bad for longterm housing needs.
A big disadvantage is that you sometimes have to be a member for a long time before you can be assigned a place to live. And most Wohnungsbaugenossenschaften are local or regional. If you have to move to another city, for whatever reason, you are not entitled to get a place there. The cooperation between Wohnungsbaugenossenschaften and the possibility to transfer a membership is very limited and not generally available. Otherwise, they are a very good idea, but not as popular as you have said.
Yes! Love the cooperative concept. In Chicago and NYC, they seem to be more affordable-older, mid-rise to high-rise buildings with many units, low entry costs-some under $100,000, and HOA fees comparable to affordable rent prices, $1200-1300/mo. In the PNW, where the concept is more recent, the buildings are newer, low-rise, with fewer units, the cost to buy a "share" is much more costly, with slightly lower HOA fees. Units cost $350,000 to just under $500,000 to purchase a share. In the newer, smaller coops, there is more land and members are required to help in the maintenance of the land, property, etc. In cities like Chicago and NYC, the coops tend to be older, mid-rise towers that offer more residences, without so much of the hands-on maintenance requirements. The HOA fees are higher in the older tower complexes, because owners are paying for someone else to do maintenance and upkeep. However, the cost to buy a share in one of these older coops is very, very affordable and HOAs tend to be several hundred dollars lower than rents in comparable apartments. The world needs more cooperatives, especially in the US!
Laws will have to change in the US, currently it doesn’t work because joining the cooperative makes you part owner in the coop. And if an co-owner stops paying rent you generally cannot evict them given current laws.
It falls under the foreclosure side of the law. Probably takes longer and costs more than a regular eviction.
The answer to the question of how hard it is to evict or to remove a coop member from membership vary from U.S. state to state. I do not believe it is accurate to say it is inordinately difficult to evict a coop member who violates the coop rules in significant ways.
@@norbertkaut5396 it will depend how you set it up. But generally you cannot force someone to sell an asset they own unless you have a preceding claim to that asset like where it’s used as collateral for a loan.
You could structure the Coop as a Corp and then the Corp rents to people, who just so happen to be owners. In which case you’d have traditional tenet agreements and evictions, but you probably couldn’t force people to sell their ownership in the Corp once they buy in unless they want to. So I could see it being a headache in either case.
This would be a great solution. Sadly, I just don’t see it happening. There are just too many rich developers and landlords making so much money off of the current housing crisis. Co-ops would provide competition that would force landlords to lower rents to stay competitive. Developers would be forced to sell property at a loss, which would be abhorrent to them. They will throw every lobbyist they can at the politicians to block any efforts to create co-ops, possibly even going so far as to making them outright illegal. Especially at the local level (local politicians are far easier to corrupt). Remember, these are people who don’t give two craps about housing affordability and homelessness. They don’t care that people are struggling to afford housing. We’ve created a rentier economy. High interest mortgage? More money into Wall Street pockets. Default on your loan? Pay loan default fees. Can’t afford a house? Pay rent to rent one. Can’t afford either to rent or own? There’s the bridge, go sleep under it. The psycopathic finacial elite would rather pay taxes on a police force to forcibly relocate the homeless to “someone elses problem” than do something meaningful that would make them less rich, like co-op housing.
Remember the two rules of Neo Liberalism:
Rule #1: Because Markets
Rule #2: Go die!
I think the word for the financial elites is SOCIOPATHIC, regardless of whether a few of them are coincidentally psychopaths.
It takes years of commitment to get into a housing cooperative, and it takes years again to take your money out. It's only for long-term.
I live in a PUD (Planned Urban Development) in which I not only own my unit but also the land under it. Of course that means it’s a row house. Our HOA is in a park like setting which creates a relaxing environment. It’s not perfect but an option worth thinking about.
There are two sides that deserve further consideration: financial model & community living. The financial model with being a resource for the “missing middle” housing (from 5-24 units) would fill a big gap in traditional lending, if non-residents could “invest” in the entity, & get a financial return along with access to facilities & the community. The community aspect can be accomplished with a separate landlord but it requires intentionality on both sides & the landLORD model is supported by laws that don’t support common non-financial “ownership”. Being able to have neighbors buy into the community without tenancy may be an opportunity to deescalate NIMBYs (no to all change by default) to nimbys (open minded but hesitant to change, typically TO them).
We pay already 1200 € here in Germany! Next month it will be 1300 €! That means one salary is already gone only for rent!
Sounds like the average low rent in the US. Not much difference. In Nashville, newer studio apts start at $1500.
@@selecttravelvacations7472 That's pretty normal here in Germany! A landlord can take up till 20 % every third year!
When I moved to Germany I "accidentally" fell into one of these, simply by applying for a place to live based on an advert. So far it's pretty great.
Emm, its like telling people, you could have invested in Tesla 20 years ago and be rich. the same way not a single housing cooperative is accepting members anymore. you could have been part of it 20 years ago.
So... set up a new one.
Pretty good spelling of this german tongue breaker (basically you can expand any noun to infinity in german, it's crazy)! Well done 👍 greetings from a native speaker
Don't overhype the sense of community. Most of the time it's just conflict and headache.
Genossenschaften are great but unfortunately they are not the solution for the housing crisis in Germany. There are by far not enough of them and it becomes more and more impossible for them to build new affordable homes because building houses became way to expensive and it becomes harder and harder for them to buy building land for reasonable prices.
Sounds like you need to solve the land price issue.
I guess a big difference between Germany and the US is also that renting homes or apartments is not for a fixed time. They are usally without any end date so no renewing your lease. Most of the time you cant even move out for 1 or 2 years in the beginning. In generell it is also quite hard for landlords to end your lease. So in most cases people move out because they want or need to and not because the landlord wants to
This means that these co-ops are not as different to the "normal" renting market as it might seem at first
I live in a apartment of a housing cooperative and over time i bought more and more shares. And once per year i receive dividends high enough to compensate around 30% of my paid rents. I love it, hehe.
What you are living in is not a co-op according to the Rochdale principles. I know that in the USA the principles are often not followed. Co-ops are supposed to limit financial returns and limit one share to one member.
I read about it and that concept’s been around since the days of the German Empire. So if anybody says that it’s a socialist concept, Wilhelm II might need to have a word.
While Wilhelm II might need to have a word, Otto von Bismarck would need to have a couple of sentences. OTOH, both were flaming socialists by modern American standards.
@@apveeningBismarck was definitely not a socialist. He was just trying to avoid social revolution happening in neighboring countries
@@pumasheen And he did so by introducing some rather extremely socialist things others hadn't even thought about like old age pension.
If we can get past the red scare propaganda for just one second, could we just agree that the emphasis on talking care of each other is a better idea than rugged individualism? The isolationist approach of America has made it harder for us to organize and get things done because we have a shattered sense of community that has many frightened for no other reason than "it's Communist!" That's the price we're paying to fight off the ghost of communism. An utter inability to communicate and work together as a community.
@@roy4173 No need to convince me, I am Dutch.
My sense is that co-op's, in general, are a more democratic approach to ownership. Democracies in government are prized but in everyday living, not so much. Co-op's in the workplace and in the living space should be available to those who wish to be a part of one. As with any structure, there are pluses and minuses and the key to happiness, is fully understanding what those factors are. Not everyone would be happy in a co-op but there are plenty who would be. We live in an individual house (because of all our dogs and cats) but we do rent out our condos. We would not be able to have 8 dogs and 7 cats in a co-op. This was another good video on raising awareness which it seems to me is what your channel is all about. Keep up the good work, Ashton.
Coming from Europe, a couple of big points id like to comment on:
First, at least in my bubble, the economic advantages of the Genossenschaften is the main reason why people want in,
and the huge disadvantage are the long waiting lists where people try to get on those lists as soon as possible to, after years of waiting, get their flats.
And lastly, most flats belong to huge organisations which are far less "we know each other and decide everything in regular meetings" and much closer to "normal" landlords.
We have them in Denmark too. We also have non-profit housing associations, these are selfowning institutions where the govt. initially just guaranteed the loans for them to take off, you rent an apartment or house from them, and take care of any garden there might be, and interior small stuff, it's organised into small divisions where the tenants have a board and an annual assembly to decide on things, including approving the annual rent increase, the institution has its own small administrative staff which is shared with a lot of other divisions, unless the division is huge, maintenance staff is also shared. Each division saves up for larger projects, like when windows needs to be changed or a new roof put up. It keeps rents as low as possible, and homes in good condition.
Hello from Denmark.
Yes, we have them here in Denmark. They are very common. and I would like to add; there is no ideology associated with living like this.
These are not "monasteries" for segments of the population with a strong political mindset. It is just a practical way of living like other ways of living.
“Property is first and foremost an investment!” …. “Aber erste moechten vir nur zu leben”. What a concept, keeping reality in perspective.
one of my best friend's parents live in a co-op in Canada that is for older retired folks, they absolutely love it and couldn't be happier, I've visited them a couple times and all the people seem genuinely happy. I think they are great options and wish we had more of them in the US.
If someone wants to build a housing cooperative nothing is stopping them, most people just don't want to have to deal with room mates or hoa's.
landlord greed in america will never allow this in america
Probably true, especially with Corporate landlords but many Independent Landlords are just trying to cover their monthly expenses for having the real estate. Not sure Renters understand all the expenses required by the owner. Unfortunately, when their costs go up, so do the rents. They must pass it down to survive. This is a big issue and property taxes for example just went up 30% in my area. Sorry Renters, you’ll have to pay for things like that one way or another too.
For the coop housing I see in the Bay Area, the reluctance is due to the relative illiquidity of less familiar financing structure, which leads to less demand, which leads to less appreciation, which leads to less buyer interest, which leads to fewer lenders serving the category, which leads to more illiquidity. It’s a vicious feedback loop.
For many in the Bay Area, we’re here to make money, more money than we can make just about anywhere else. Getting into high appreciation housing is part of the plan. Even people who struggle to afford housing want in on that appreciation track.
Don’t confuse the ownership co-ops with non-ownership co-ops. Non-ownership co-ops are capitalist, but originate with the Rochdale weavers: a workers’ organization. It is just that the return on that capital for a housing co-op is the useful value of the building, and never monetary. The value is the safe and comfortable home. Not always an apartment, but mostly so. Co-ops are just another form of corporation.
Tbh this concept is underrated even in Germany
What you are naming as cooperative housing is probably the same as „soldzielnie” in Poland in (soviet-communism times) PRL, they still exists and i think started to build condos again in Poland. Yes they have much better shared Spaces and common courtyards, parks than housing build by developers
with the main difference being the lack of spending transparency and no accountability from the board
Things that need to happen first in US before housing prices fall:
1) Change zoning laws.
2) Block NIMBY challenges to multifamily buildings.
3) Remove private equity/Wall Street from buying up and investing in housing. They have cornered the market.
4) States embrace public housing and maintain it properly.
Coops can help but it's a drop in the ocean compared to the above issues.
I have lived in two apartments from housing cooperatives - and still own shares of the second, as they hand out quite some interest if you do not live in one of their apartments. It is like a rental home here in Germany, but instead of a rent-deposit you buy shares. And if you move out and things need to be done because of you living there and not renovating properly (walls and windows, painting doors, too) or you did cause some damage beyond normal wear and tear - you forfeit those shares like you would a deposit. But if you move out and do not violate your contract conditions (and they are way more lenient over here anyways, for example fixing shelves to the wall and hanging pictures is always allowed, unless you drill so many holes that the wall resembles a swiss cheese) you can keep those shares as a kind of investment. The interest rate you get from that investment is usually over what you get from a savings account - and more secure.
In short: You can pool your money with others to buy or construct houses, then rent them out and earn returns from the dividends on the shares of the housing units you hold. So much for a non-capitalist solution...
Nope. What you are describing is a regular development corporation. Look up the Rochdale principles for co-operatives. There are many condominiums that call themselves co-ops but aren’t co-ops.
@@benjaminmoogk3531 "There are many condominiums that call themselves co-ops but aren’t true co-ops."
Yeah, that’s what I’m saying. Even if something starts with good intentions, it will probably devolve into a real estate investment.
I don’t quite get whether we are stating the same thing or if you have a different view on the topic.
In that case, I’d like to know the resources on which you base your stance.
I admit that I don’t know much about the "Rochdale Principles", but I’ll take the time to read up on them (or explore other media). If you could point me toward some resources, it would save me some time getting started.
I don’t think it would work in the USA.
Biggest obstacle is the zoning.
A nearly as big obstacle is the perceived „individuality“ and the scare of socialist = communist ideas and principles. Sadly, a large part of US society believes nowadays in such nonsense.
(I say perceived because most homes are so-called „tract homes“ which don’t look identical on first sight, but basically are just a couple floor models with a bit different outside paint, eaves, fake balconies. Even the bathroom and kitchen furniture, drapes, light fixtures are pretty much identical.)
Bye the way, I lived nearly 10 years of my life with my parents in a „GWG“ apartment (Gemeinnützige Wohnungsbau Gesellschaft) in Reutlingen, BW, then in rented flats/condos in Germany and in California (there was even 1 house in between which we lost shortly after purchase in the recession of the early 1980s), we’ve lived in a regular Eigentumswohnung in Germany for the last 30 years.
I wish there would be much more „social housing“ and co-ops built in Germany, we’re lagging far behind.
The “cheap housing” found in especially smaller towns in the former East Germany are, for the most part, in areas without much employment opportunities.
0:30 Hi, compared with your house in Germany, houses, you show here, are in Germany very expensive as well...
People still want to own a house as security for the future so that they have a place to live in retirement and dont have to worry that someone will kick them out or that they wont be able to pay the monthly fees.
Almost everyone who moves into my co-op lives their entire lives here. More renovations are oriented to making units safe for elderly members. Wider doors, grab bars in the bathroom, and that sort of thing. We now have several generations of members as the location and fees are unbeatable. I’ve see children grow up and have their own children here.
I've been living in my cooperative flat for 20+ years and happy with it. No risk of having to move because 1) the rent is quite low, and 2) it's written in my contract that the co-op *will not* end the rent from their side (unless i severely breach my contract of course). It's guaranteed that I can stay as long as I want. Nice peace of mind!
Love what you picked for content and how you string words together
Non-capitalist, let's use that word in stead of socialist. cooperative housing is used a lot in Denmark, and probably a lot of countries.
She clearly said the coops are not state owned, they are private entities, if anything the non part is what's questionable...
@@daniel-or6sb socialism is nonprofit democratic people owned housing, production, shopping, insurance etc. and doesn't have to be state owned, sometimes preferribly not.
@@JesperMillingnot really, people getting together and creating a company is 100% compatible with capitalism, it's the "voluntary" part that matters.
@@daniel-or6sb Socialism IS compatible with an economy allowing for-profit-companies. Even in God's own country. And Coops have existed for decades, and served their owners and customers and employees well.
@@daniel-or6sb "creating a company" does not make it capitalist. Creating a company that extracts value from other people's labour does.
Priority to prior participants and waiting lists, rather than higher prices, is another way to translate scarcity.
It's great for the lucky few, but people on the waiting list still need to pay for a supply that's just too limited.
This system can be a way to increase supply, but in the end it's just more housing units we need, no matter how they get built.
@siemdecleyn3198, correct. And at the end of the day, even co-ops have to find the money, the real estate, the materials and the contractors to get anything built. And there the difference isn't all that much. Otherwise the boundary conditions are also the same, like mortgage rates, bureaucracy, NIMBY neighbours, you name it. It is not as if commercial developers were all about price gouging. If that was the case there would not be quite as many of them (at least in Germany) to go belly-up.
On top, those touted low rents are all coming off the principal. For commercial landlords, private landlords and also for co-ops as well. When overregulated rock-bottom rents make mainenance impossible, something has to give eventually. Economics are a b****.
It's not "lucky" few. If you were alone you'd have to wait for luck to build you a personal home, a cooperative is a means to increase your luck. Not being allergic to "politics" is even more lucky, when an entire actual nation exists around you.
US fed is no nation, they first of all don't have a Language Regultory Body, so they don't have a genuine native language. This leads to no genuine education, because you can't work with the population you HAVE, over dreaming about the diligent worker drones you WISH you had as neighbors.
Every real nation faces problems like how to FORMALIZE the education of say, French Canadians. How do you formalize Latin Americans in America? Oh yeah, define them as "anti-american" like Semitic Arabs are defined "anti-semitic". And driven off the border.
you can't even keep track of where the American continent stands when your federation claims otherwise, that ulike Asians and Aficans, Americans don't have a geographic home but only a theoretical one. Were a lot of people across the Sindhu river are not welcome, not even, if you ask Bureau of Indian Affairs.
You starting to feel like the Iroquois were waiting to get lucky? ALLOWED a home by the AMERICAN fed?
The video goes out of its way to suggest that the way housing gets built matters. Homes are always going to be a significant expense; building quick, shoddily and without anyway of sustaining liveability is no answer. As for your statement about 'lucky few' it's hard to parse what you mean- there are nations where 80% of the population live in these legal structures....
@@lb9147 Lucky few as in there are waiting lists and priority for people who come from the neighborhood (another building from the same organisation).
Everyone needs to live somewhere every night.
The costs might be below market rate, but unlucky ones still need to pay market rate.
The only way to decrease the market rate, is to change zoning and allow more housing to be built.
@@siemdecleyn3198 oh, i see what you mean. In cultures that use 'Zoning', such as the US, changing zones would make a difference yes
Co-ops in the US have fees that you have to pa, in many cases, they are as high as your mortgage. I wanted to buy in NY/NJ area and they are about 150k, but when you factor the HOA, you end up paying a monthly mortgage equivalent to a 350k house if not more. This is for older units, new units are far more expensive. Even if you think this is good, remember that the Co-op has to fix and the building and some assessment after 10, 20, 30 years, they can be in the millions. Look at what is happening in FL with condos. HOA's skyrocketed to have money in reserves and on top of that each unit needs to pay ~150k to pool all the money to make the fixes to the building and keeping it legal and safe. If your HOA or dues are low, have in mind that eventually you have to all the money at once to pay for maintenance that is needed. This is typically a cost many people do not account for and are surprised when they are due.
Yeah but the thing about those fees is they pay for the maintenance of the structure and the grounds. In the same way that rent is supposed to pay for all the maintenance of the building with a profit margin on top, Co-Op fees are supposed to cover all those maintenance expenses plus other things you don't necessarily think about like property tax and insurance. You probably have to pay something like renters insurance for the contents of your unit, but not for the structure.
In a single family house you might end up paying less per month, but then you get stuck with a five-figure bill for a new roof after 10 or 20 years.
@@AlRoderick It shows that you don't own a home........maintenance happens all the time , and you know if you'll need a new roof in 3-5 years and have time to plan....!!!!!
I live in the US. We have co-op properties here. You own your portion of the land. These work best for modular/mobile home parks. The payment is extremely small. Taxes are much more affordable. You vote on improvements to shared properties.
The idea behind is known well from a great film 🎥, with Danna Reed and James Stewart. The Titel was "Its a wonderfull World"
But as a Bank. Build by local people.
The first Bank in Germany work like this was Raiffeisenbank. This ships over WW1 WW2 and last finance crisis...
2 differences between condos and condos, you own the unit in s condo drvrlopment, and condo boards don't veto sales to a particular buyets. FHa and The VA won't lend if condos still have the first right of refusal in their documents. And, being a cooperative doesn't change the market rate price of houding.
I don’t think the European-style housing co-operatives would ever work under common law. They’ll just degenerate into endless legal disputes where those who like that conflict end up with preferential treatment. The civil law system Europe uses is very resilient to that problem which is why Europe enjoys nice things like housing co-operatives and on-budget construction projects.
View from the UK. Firstly never heard of this model, sounds like a good idea. UK is very much sold on the dream of single family homes, but the rental market is toxic 6 month rolling terms, and effectively renters are paying the mortgage (they just can not afford a deposit so a renter is paying some else’s asset purchase) things must change. Developers also bank land and restrict building to keep prices high (I believe if land is not being developed it should be returned others for development to continue)
Condos in America aren’t any more affordable than the other overpriced options because, while the “purchase” price may be much lower,you are still on the hook for “fees” that add up to about the same as what renters are paying. To add insult to injury, the HOAs force fine print on everyone, to say that the “owner” has to also pay for whatever special projects and other fee increases that the HOA decides. Hard for such scams to generate any sense of community.
And that is exactly not how those communities work in Europe.
A home owners association is not the same thing as a coop.
Tbh. We have a growing housing crisis and no relieve in sight. Cooperatives build way too less (and are susceptible to corruption and embezzlement.)
Coop housing with its shared ownership model would be probably be welcomed in a good number of the US communities opposed to multi-family housing but you could never get the zoning right as any reasonable multi-family building definition would also open the door to subsidized multi-family housing and its associated social issues. The resident of the towns with restrictive zoning just don’t want the hassle of the later. It basically comes down to people take better care of things like the coop building they own shares in than stuff someone else owns.
I've heard quite a bit about the zoning issue in the US. 70+% of land is zoned for single-family homes. 95% here in CA. But this co-op thing sounds like an actual solution. If developers can be confident in the financial return on these buildings, they'll find a way to change the zoning.
There isn't a massive shortage of homes in the US, they could fix the entire housing "shortage" tomorrow if they made it illegal for hedgefunds/investment funds/corporations to own residential housing. And break up the price fixing scheme landlords are doing across the country.
Most apartments and condos are actually "empty" because those empty residential buildings are used to jack up rents for other people looking to rent. It's a fake supply issue, it's similar in the way that a few bussiness's control diamonds. If you make a supply scarce then you can jack up and price gouge prices.
It's a fake problem.
Thank you! I was trying to explain that to someone.
Also, the open borders hurt the working poor. They rent those out to illegal immigrants by the square foot. They can man thousands a month for a shack by cramming 20 people in there.
There is RealPage too.
The solution to this is also stupid easy and wouldn't require new laws.
Double the cost of the property tax for every single residential block a company owns. Most cities/towns can do this at the state level without the need of federal involvement.
Next, implement an empty residential tax. So if a company owns a condo building, jacks up rent on 100 units keeps 20 filled with the higher rates and 80 empty because no one can afford it, for every residential unit they have that isn't filled their tax increases per unit by 2% a year.
Just these two changes would solve USA's housing crisis over night. Doesn't require federal laws or the chambers of power in the USA, can all be done at the state level.
@@windatar6351 In California, the rental vacancy rate is less than 5%.
Starting a possibly long comment...
* rental terms other than "unlimited duration" are very uncommon in Germany. People don't move unless their living situation requires it. Evicting someone is also rather hard and has to have a good justification, e.g. if you own an apartment that you rent out you can tell the tenant to move out if you need the place for yourself. However, if you own more than five apartments, you can't any more (I think the assumtion is, you can afford to rent something else). If you're anything other than a human, this justification is invalid. What remains is serious misbehaviour of the tenant, e.g. non-payment of rent.
* I grew up in an apartment in the Familienheim Co-Op in Freiburg. Sense of community? To a certain degree. Possibly we were lucky, the whole building (42 units) were only nice neighbors.
Today, Familienheim has a waiting list of 6-7 years and (if I remember correctly) a share price of 4000 Euros. On the plus side, the rent is about 30% below average.
I looked into a co-op here where I live in Canada. Because you can't get a traditional mortgage, if you don't have hundreds of thousands of dollars in savings, or are selling a house to downsize, you can't afford to buy into a co-op. Many also don't permit pets.
We changed the bylaws during the pandemic to allow dogs. The biggest barrier is that governments stopped guaranteeing building loans thirty years ago. Land acquired for build new co-ops was sold off. So no new co-ops. The theory was that the free market would provide housing for all incomes. Most co-ops have closed their waiting lists because demand is so overwhelming.
I am very curious, bc Germany has its troubles in this field.
That is easy, finance Investors pay higher price for ground. Next people need a money for a share. Than the people must be sateled in one Region. If you invest in a share, you had to wait a long time. In some Regions 10 year..
So Genossenschaften are a solution for middel class people.
But this is a Part of a solution.
Germany has regulatory issues. Planning anything takes a decade...
Basically people who do not stay currently in the co-opoerative pay a subsciption fee for the opportunity to enter the co-operative. Very impressive...
You need to ammend your statement about shortage of homes. It's actually a massive shortage of AFFORDABLE homes. That is key. Because in my city there are all kinds of homes being built, all kinds of condos being built all over the place. None of them are affordable, because the city wants the tax dollars and the builders don't want to make inexpensive homes. Everything is "luxury" or touted as that. It's a crime really. Ever since COVID, when people living in condos realized single family homes (SFH) were better, there has been a glut of expensive condos, and a shortage of SFH -- that people could afford to purchase. Add to that the greedy real estate world who got into the habit of "auctioning" off houses to the highest bidder and you have a recipe for disaster. People buying homes they cannot afford at prices that they will never pay off. This of course leaves older people who own homes and longer have children in them, stuck in their too big house because they cannot afford to get a smaller house - this preventing a family house going on the market. When a bungalow is just as expensive as a 5-bedroom home, you know there is a serious problem with greed.
What solution? The housing market is literally dead over here. Entire generations (pretty much everything younger than boomers) can´t and never will be able to afford a house.
They completely stopped building social housing as well.
Greed has been, and continues to be a major driver of the housing crisis. As an aside, co-ops are fairly common in Canada. One thing that has helped to exacerbate the housing crisis in Canada is the fact that the Canada Mortgage and Housing Corporation (CMHC) stopped funding the construction of co-ops 30-odd years ago. CMHC is a federal government agency that is roughly analogous to FNMA in the US in terms of its function and purpose.
You should have more subscribers. The quality of the videos is simply stunning!
Most apartments are not from a Wohnungsbaugenossenschaft. Most of them have years long waiting lists. There is no chance to get an apartment tomorrow in my hometown. Some of them only take renters with a WBS, meaning only renters with a low income. I compared the salaries in Germany with the Salaries in Florida and California and the jobs I compared a paid about 5 times better in the US. From what I've seen it's a lot easier to buy a big house with a double garage and a nice garden in the US than in Germany. At the same time many things are cheaper in the US.
we have CO-OP housing in Canada but they have gone way out of favour due to LOW affordability in the 70s PLUS the "community" requiring pre vetting would be "neighbors" getting "famous" for ONLY letting in "people like them"
the financial issue is in Canada if you BUY a home/condo YOU own 100% of the title to it and banks will lend 75% of the value with CMHC backstopping up to 95% done by buying the mortgages of the banks as investment assets and "fin tech" wizardry
A CO-OP is a fractional ownership of a BUISNESS that happens to OWN and RUN a building and is considered an investment asset and banks will cover 55% ONLY requiring 45% of the value up front and the amount discount for a CO-OP does NOT cover the difference as the building as a whole and extension the CO-OP "company" was a "base" value equal to the building valuation
Co-op housing construction did not rely on for-profit construction companies. The housing co-op movement of the early 20th century was backed by unions and successive social democratic governments. The govt would provide land and subsidies and the union labor would be hired directly by the co-ops, cutting out any for-profit developers. The workers were basically building houses for themselves and their colleagues. With cheap land and in-house construction, co-ops can construct housing much more cheaply than the prices you are familiar with. Of course this was (and is) only possible with a big Eco-System and support from unions and governments
@@substanceandevidence My friend is a developer ....for the price of the Union workers for one home, he can build 3 homes with self employed workers ......!!!! let that sink in for a moment....!!!
I like the residents being involved personally with the upkeep.
Type Ashton is one of my favourite channels! The zoning-restrictions in the USA are kind of surprising - for "the land of the free - and brave" it really seems to forbid many good experiments with new solutions. Tell us more!!!
Das eigentliche Problem ist, das die Nachfrage auf dem wohnungsmarkt gegenüber Preissteigerungen nur eine geringe Elastizität aufweist, weil wohnen ein grundlegendes Bedürfnis ist. Anders ausgedrückt: wenn die mieten steigen, verzichten die davon betroffenen lieber auf andere güter und Dienstleistungen. Wohnen hat eine eine hohe Priorität. Das liberale Argument ist hier immer das die menschen ja wegziehen können. An sich stimmt das auch. Aber dabei wird gerne vergessen das menschen in städte ziehen, weil sie das "stadtleben" leben wollen. Das kann man nicht einfach mit einem umzug in die Pampa substituieren. Das ist nicht das gleiche wie wenn man von milch marke A auf milch marke B umsteigt. Zudem sind menschen durch ihre Anstellung und ihr soziales Umfeld an orte gebunden. Und das spiegelt sich eben auch in der geringen nachfrage Elastizität wieder. Deswegen halte ich den markt als primäres mittel der Allokation von wohnraum, für ungeeignet. Der marktmechanismus greift hier einfach nicht richtig, weil vermieter eine enorme Macht haben. Sie können die preise viel weiter als auf anderen märkten in die höhe treiben, ohne das die nachfrage einbricht. Und darunter leiden dann andere branchen, weil die menschen auf ihre Güter und Dienstleistungen verzichten.
Intergenerational wealth creation is the reason Americans love single family homes.
I agree with Ashton on the Cooperative model as a solution to the housing crisis, but living in one allows me to experience some of the negatives. In the US one should use the tools of the National Association of Housing Cooperatives for success. It is too easy for a person or group to grab control of the cooperative.
I imagine what happens when people go from Facebook groups to a co-op 😊
You shouldn't have to be forced to be constantly bothered by your neighbors to have affordable housing! Housing is a human right & should be DECOMODIFIED.
Interesting idea. What's your solution?
What I still don’t understand is how you have the resources to bootstrap a housing coop. Like if people are already struggling to afford rent, how do you get a bunch of those struggling people and get them financing to build an apartment building? Slapping an LLC on a group doesn’t magically make them capable of getting loans. It seems like starting a coop would really only work with a group of people who have significant savings to invest. So your target demographic is people who are financially comfortable, just not well-off enough to buy property on their own. This doesn’t sound to me like a solution to the housing affordability problem, unless there is significant state investment in seeding housing coops.