Education
training &
information

Co-operation
among
co-operatives

Concern
for
community

Frequently Asked Questions

What are they? Housing co-operatives are a form of housing which provide quality, affordable, secure housing for their members. They are usually not for profit organisations and are managed by the members who also live in the properties. In this sense, the members take on the responsibilities of tenant and manager of the housing.
Who are Co-ops for? Co-ops are for anyone, regardless of age, sex, colour, religion, sexual preference, ability, marital status or race. All sorts of people live in co-ops in WA. There is not a 'typical' co-op member, co-ops house a cross-section of people of all ages, race, and lifestyles.  
What are the advantages of housing co-ops? There are many benefits of co-op housing; both for individual members and for the broader community. For the individual, some of the benefits include:

  • long term security of tenure in quality housing.
  • Affordable housing.
  • Being part of a supportive and friendly community.
  • The opportunity to choose where they wish to live and to contribute to the design of their home; including the provision of innovative design and construction.
  • The opportunity to benefit from education and training aimed at helping members to effectively run the co-op; and to gain confidence in their abilities and skills.
  • Escaping from the dependency on 'others' by running things for themselves.
  • Being part of a democratic and consensus-based organisation which values all members and their contributions.

For many individuals, co-ops bring the benefits of owning a home, without the financial burdens. Co-op members have responsibility for the management of their homes which requires a commitment in maintaining the property. For the wider community, co-ops can also be a benefit. Co-ops seek to be community resources through community education, events and facilities. In many ways they contribute to a sense of community and to a balanced social mix in the area they are located in. Many co-op members are involved in other activities such as community theatre and environmental groups.
What sort of housing? Co-ops provide many types of housing, depending on factors such as:

  • What members want.
  • What housing needs are.
  • Availability of land or dwellings in the preferred location.

If co-ops receive government funding the housing must be built in accordance with public housing budgets for comparable developments and must meet Department of Housing standards in terms of quality, design and materials used. Co-op members determine the sort of housing which the co-op will provide. There are two main ways of obtaining housing, although the two are often combined in a co-op:

  • Spot Purchase - this means that the co-op buys existing dwellings which suit the needs of the members. This could include homes in the same street, the same suburb, or in different locations. Often the properties may need some money spent on them for upgrading to suit the needs of the co-op.
  • New build - this means that the co-op locates land, purchases it and designs homes which are then built on it for the co-op.

How does a housing co-operative work? Each housing co-operative is slightly different, however, many co-ops in WA share a number of common features:

  • They are generally not for profit organisations which become incorporated under the Associations Incorporation Act 1987.However, since the WA Co-operatives Act (2009) was gazetted, this is becoming the obvious choice for new developments to express their common ground with all co-ops.
  • They are member-managed organisations. This means that all members of a co-op have equal rights and responsibilities in the management and operation of the co-operative.
  • Their primary aim is to provide secure and affordable housing to their members
  • They operate in accordance with the International Principles of Co-operation.

  What are the Principles of Cooperation? These renewed Principles of Co-operation are taken from the International Co-operative Alliance Centennial Congress (1996):

  • Voluntary and open membership.
  • Democratic member control.
  • Member economic participation.
  • Autonomy and independence.
  • Education, training and information.
  • Cooperation among co-operatives
  • Concern for community.

Who owns the houses? This depends on the type of co-op, there are three primary ownership models, common equity, shared equity and equity. These models are outlined below;

  • Common Equity (non-equity) - the majority of co-ops in WA operate under this model. The title to the property is held by the co-op. Individual members do not own their dwelling. Where the co-op has received funding from the Department of Housing to construct or purchase the housing, the co-op enters into a legal arrangement with the Department of Housing which secures the governments interest in the property. Common equity housing cooperatives need to be part of the Department of Housing’s registration process. FOHCOL can provide additional advice on this.
  • Shared Equity (Limited Equity) - This model can be set up under a wide variety of legal and financial structures. Under this model the co-op will share the ownership of the co-op with individual members who may own all or part of their individual dwelling, together with the State Government and or private investors.
  • Full Equity - Members of the co-op own their individual dwelling but share a desire to live as part of an identifiable community.

How much does being a member of a co-op cost? Again this depends on the co-op model and will vary from $1 in common equity co-ops to the purchase price of a dwelling under the Equity model. In a common equity co-op tenants will pay rent to the co-op as long as they reside in housing owned by the co-op. In a shared equity or equity co-op members may not be required to pay rent. As stated previously the majority of co-ops in WA are common equity co-ops which have been 100% grant funded. Within these co-ops the rent is set at a maximum of 25% of gross household income up to a maximum set by the Department of Housing guidelines.  
What happens to any rent that is paid? The money collected from all of the rents is used to manage and maintain the co-op properties. These costs include operating costs such as rates, insurance, maintenance costs and any other expense incurred in the functioning of the co-op.  
How is a Co-op set up? There are 6 stages in the setting up and continuing growth of a Housing Cooperative:

  • Stage 1 Coming together - a number of individuals come together and decide to set up a co-op. The group spends time on establishing agreed aims and objectives, and establishes the processes and procedures it will adopt in working together. This may involve doing a ‘feasibility study’ of what the cooperative hopes to achieve.
  • Stage 2 Formalising the co-op - The group formalises its agreed aims, policies and procedures by developing a constitution or memorandum of association. The co-op will then become incorporated as either a not for profit association or as a registered company, depending on the ownership model that has been agreed on. Decisions are then made regarding the type and location of housing.
  • Stage 3 Financing the Co-op - If the Co-op is applying for government funds, a submission for funding to Department of Housing lodged, including what type of registration process will be undertaken. If the co-op is developing its own financing options then the appropriate legal and financial structures would be developed at this stage.  
  • Stage 4 Building the homes - When the co-op is successful and receives funding approval or raises the necessary finance, the group will then focus on spending the funds. The co-op may buy existing homes, or purchase land and employ an architect and builder to construct new homes.  
  • Stage 5 Starting managing - Once the homes are built or bought, the co-op members move in and manage the properties. Systems for effective and efficient management and maintenance are established.  
  • Stage 6 New aims, new growth - After an initial inward-looking period of consolidation, the co-op will begin to develop projects and schemes aimed at the wider needs of the members and the community. This may involve going through the whole process again from stage 3.  

What assistance is available to new co-ops? Apart from FOHCOL, new and established co-ops are able to also access assistance from the Community Housing Coalition of WA (CHCWA). While FOHCOL is the peak body for the housing cooperative sector, CHCWA is the peak body for all Community Housing Providers in WA. This includes the housing cooperative sector but also organisations providing housing to low income families, young people Aboriginal people, people with a disability and migrants. An important role of CHCWA is the provision of a development and training service to community housing providers, including co-ops. However these resources are limited. Specifically, CHCWA can assist new co-ops by providing resource material to help with the process of developing policies and procedures and becoming incorporated. Assistance is also available for writing submissions and developing finance proposals. CHCWA also provides training in property and tenancy management to the community housing sector.  
How long is the wait for a house? This is always the most difficult question to answer. Some people may wish to join an existing co-op and may be able to move into a house quite soon (although the small number of co-ops means this is unlikely). On the other hand, people may wish to set up a new co-op this can be long and sometimes frustratingly long but ultimately rewarding process.  
How do people become members of a co-op? Established co-ops have their own procedures for new members. People are usually asked to attend some meetings and after some time talk about why they want to join. Co-ops are keen to get new members who want to contribute to the growth of the co-op and who agree with the broad aims of the co-op. In addition, co-ops may have tenancy selection criteria which are based around housing need. People wishing to set up a new co-op may wish to seek the advice from FOHCOL. Starting a co-op is a big commitment, but is a lot easier if you start out with a group of people with similar aims.  
What skills are needed? Everyone has skills which will benefit any co-op they join. Things like childcare, typing, knowledge of building construction, facilitation, bookkeeping, and gardening are just a few examples of useful skills in co-operative housing management. A good co-op will help people use their existing skills as well as develop new skills. The most important attributes required of members include:

  • The ability to co-operate.
  • A willingness to learn new skills.
  • A willingness to share and teach others their skills.
  • The ability to listen to other peoples views.
  • Flexibility.
  • A willingness to admit mistakes.
  • A sense of humour, patience, creativity and imagination all help!

  How much time do people need to commit? This depends on how involved in co-op housing people want to become, and on the expectations the co-operative has of its members. Fundamentally, there is an expectation that co-op members will participate in the life and the work of the co-op. Some of the areas in which members can become involved are:

  • Taking turns at facilitating, minute taking, timekeeping etc.
  • Being an office bearer in the co-op (eg. secretary or treasurer).
  • Being on a sub-committee in the co-op.
  • Representing the co-op at FOHCOL meetings.
  • Becoming an office bearer of FOHCOL.

There are many opportunities for involvement within co-ops and beyond. It takes a lot of effort to set up a co-op, and an ongoing effort is required to keep a co-op running. The individuals within a co-op need to decide on a fair way of dividing the workload.  
How will it affect a person’s life? Housing co-operatives operate according to the Principles of Co-operation. This means that housing co-operatives, and the sector as a whole, are committed to the practices of co-operation, education and development. Members are thus part of an international movement committed to sharing and community building. Co-ops provide a framework for the development of community. There are opportunities to create a sense of belonging, community spirit and togetherness when you are involved in a housing co-operative. Being involved in a housing co-operative requires a commitment of time, energy, and patience. It can be hard work! It can be challenging! It can also be great fun, exciting and interesting! Many co-op members grow as individuals in terms of confidence, skills and knowledge. Co-ops offer the opportunity to meet people with similar aims, have fun and feel part of a wider community.