In Germany, we have the Mietshäusersyndikat. It's structured a bit differently from a legal perspective, but in practice, it's the same idea: You own the house that you live in. The general idea...
In Germany, we have the Mietshäusersyndikat. It's structured a bit differently from a legal perspective, but in practice, it's the same idea: You own the house that you live in. The general idea is actually over 100 years old. I don't understand why it is still perfectly normal to profit from housing.
Switzerland is notoriously expensive, but affordable apartments like Mr. Waelti’s can be found in cities across the country. Known as cooperatives — though distinct from American co-ops — they are built and run by nonprofit organizations and represent a kind of “third way” beyond the classic rent-or-buy choice.
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In Switzerland’s member-based cooperative housing, new residents buy shares to gain admission to the building and get one vote in the corporation regardless of how many shares they own. The co-op uses the money to maintain the building, keep rents below market rate and, often, provide communal amenities like child care.
When a resident moves out, their shares are returned at face value. There is no capital gain.
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While most Swiss co-ops finance themselves, newer ones are often helped to their feet by the government, which offers land at cheaper rates and low-interest loans, and sometimes buys shares in return for housing for low-income residents. Rents are calculated strictly on a cost basis, meaning there’s no developer or owner seeking revenue.
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Switzerland has long been a leader of cooperative housing, said Alice Pittini, a researcher at Housing Europe, a group that represents public, cooperative and social housing federations around the continent. That may seem paradoxical given the country’s capitalist zeitgeist, but around 8 percent of dwellings in Lausanne, a city with about 140,000 residents, are co-ops. Mr. Waelti’s co-op, the city’s largest, comprises 101 apartment buildings that house a total of 5,000 tenants. There is a waiting list of 1,000 people.
Cooperatives are only one facet of Switzerland’s welfare state, which has very low rates of homelessness and strong tenant protections. (The majority of Swiss are renters, partly because home prices are so high.) Even in Zurich, Switzerland’s financial capital, nearly one in five apartments is a co-op, and the city aims to make it one in three by 2050.
Switzerland has a housing crisis and it’s a major point in politics right now. Rents are insanely high. A square meter in Zurich was 20k CHF to buy last I checked. If you want to buy a house in a...
Switzerland has a housing crisis and it’s a major point in politics right now. Rents are insanely high. A square meter in Zurich was 20k CHF to buy last I checked. If you want to buy a house in a less desirable area you still have pay a million if you’re lucky but more like two if you’re realistic. Mortgages rates are low though but still. There isn’t enough housing for everyone with barely any vacancies in most cities.
Even in America there are a few places like that, but they're vanishingly rare. The only one I can name is Atchison Village, in Richmond, CA. It's a brilliant model for separating housing from...
Even in America there are a few places like that, but they're vanishingly rare. The only one I can name is Atchison Village, in Richmond, CA. It's a brilliant model for separating housing from investing.
I'd be very interested in this form of housing. I did notice that the article only highlights the upsides but doesn't mention any downsides. I wonder what the downsides are of non-profit co-ops....
I'd be very interested in this form of housing. I did notice that the article only highlights the upsides but doesn't mention any downsides. I wonder what the downsides are of non-profit co-ops. I'm sure there's plenty of drama.
In my experience living or being in communal situations, things get toxic when certain members become free riders (tragedy of the commons effect, where negative externalities put out by free riders must be absorbed by good-faith participants) or really enjoy power and asserting control over other people's lives, since being a co-op board member is unpaid and boring work and isn't something most reasonable, well-adjusted people clamor to do in their free time — which mainly leaves the folks with too much time on their hands. You have to be verrry careful about who you allow in, and even then there are no guarantees.
I'd love to start a non-profit co-op but one where there's no board, only a paid manager who everyone agrees to hire or fire. That way, they're only motivated by money to perform their duties and no more and will be indifferent to the minutiae of residents' lives.
Im not sure that it's a downside on a broad societal level, but in areas with extreme wealth inequality, housing co-ops that used to be for poorer people will absolutely fill up with richer people...
Im not sure that it's a downside on a broad societal level, but in areas with extreme wealth inequality, housing co-ops that used to be for poorer people will absolutely fill up with richer people if housing speculation starts really taking a bite out of the local housing market. At some point even the middle class will give up on getting a return on their house just to have secure housing, and so the prices will exceed the range where the original blue collar occupants can afford to live there. At that point, the organizing body will have issues with managing sociocultural differences between new and old tenants. It wouldn't happen so much in an overall saner housing market, but a single subdivision organized like this cannot cure the overall problems of the housing market.
One downside that occurs to me is that when someone leaves, they get back what they put in, but that might not be enough to buy into the next place if prices are rising.
One downside that occurs to me is that when someone leaves, they get back what they put in, but that might not be enough to buy into the next place if prices are rising.
That's a general problem with buying real estate. There is no guarantee that you get your money back when you have to sell. I couldn't read the article because of the paywall, but in general, that...
That's a general problem with buying real estate. There is no guarantee that you get your money back when you have to sell.
I couldn't read the article because of the paywall, but in general, that problem shouldn't be too hard to solve. Everyone just pays a little more rent and the additional money is invested. The point is: The residents can decide how much money they want to put aside and they can get it back. If you rent normally, all the profits you invested over the years stay with the landlord.
I'm not saying it's necessarily worse than other solutions, but this doesn't eliminate controversy or politics. Residents can evaluate whether a proposed policy benefits them personally or not and...
I'm not saying it's necessarily worse than other solutions, but this doesn't eliminate controversy or politics. Residents can evaluate whether a proposed policy benefits them personally or not and vote accordingly.
As we see with inheritance disputes, dividing up a pot of money can result in lots of contention. Also, the Surfside condo collapse is a worst-case scenario where a contributing factor was that residents were unable to agree on expensive repairs.
Cooperative ownership (not sure what the correct term is, I mean different parties owning flats in the same house) has been a thing for a long time. The only difference here is that you can only...
Cooperative ownership (not sure what the correct term is, I mean different parties owning flats in the same house) has been a thing for a long time. The only difference here is that you can only own the flat you live in, so your incentive to take care of it should be very much increased compared to an owner to whom it's only an investment.
And yes, I can tell you from experience that it sucks, but it's still way better to fuck yourself than getting fucked by some faceless corporation who doesn't even have a concept of fucking people because its only purpose is to increase profits.
Democracy always sucks, but until we can create an all-powerful AI or find an alien species who want to take care of humanity as pets, we have to figure this shit out for ourselves.
What if there is no need to ever "buy up" the next rung on the ladder? Eg, age in place and have family live together and take over the unit. Or, failing that, one invests the difference between...
What if there is no need to ever "buy up" the next rung on the ladder? Eg, age in place and have family live together and take over the unit.
Or, failing that, one invests the difference between rent and coop fees, so that the nest egg has grown alongside the static co-op chunk. If housing costs rise way faster than market investments then there'll be a gap. But if the pace is kept evenly, or there's a crash, or the owner needed liquidity during those decades, investing the difference is the superior choice.
People may want to move because the location or the apartment doesn't suit them anymore. Maybe they get a new job or want to move closer to relatives? And sometimes couples break up. But I'm not...
People may want to move because the location or the apartment doesn't suit them anymore. Maybe they get a new job or want to move closer to relatives? And sometimes couples break up.
But I'm not saying it's necessarily going to happen, just that it's a possible downside that I thought of.
That's a good point that they could invest the difference, assuming they have the money to invest. But I think part of the point of making it more affordable is that many people wouldn't have the money? They might save it up over time, though, due to the lower rent. Having less of your net worth in real estate can be an advantage.
Right, because a mortgage is a liability, whereas an investment actually pays interests and dividends. A coop can also pool resources to tacklet capital projects and maintenance, and even if you...
Right, because a mortgage is a liability, whereas an investment actually pays interests and dividends. A coop can also pool resources to tacklet capital projects and maintenance, and even if you hit a financial rough patch those projects are paid communally and can still get done.
And I know it's been decades of rising prices, but there are still many seniors who need to move but cannot afford the next downsize because their homes are old and not near a city. Liquidity always give more options.
...a substantial portion of the passive investment market is founded on real estate speculation, enough that i'm not sure even ethical funds can avoid contributing to the problem...private...
...a substantial portion of the passive investment market is founded on real estate speculation, enough that i'm not sure even ethical funds can avoid contributing to the problem...private investment offers an alternative, of course, but unless you strike a wunderkind opportunity, most productive business models struggle to outpace inflation without dabbling in the same speculative-capital shenanigans as the public investment markets...
That might be one of those "bide your time until big enough to change the game" compromises. But for most families, this isn't driven by ideological "boo speculations" but by "can I afford to...
That might be one of those "bide your time until big enough to change the game" compromises.
But for most families, this isn't driven by ideological "boo speculations" but by "can I afford to retire". Which means investing in a fund that does worldwide real estate plus other industries is a far safer bet than one single house in one location.
I think it could be an improvement, but I don’t know how much the game can change? I don’t see how you avoid supply and demand imbalance in a world with increasing wealth (for some) and...
I think it could be an improvement, but I don’t know how much the game can change?
I don’t see how you avoid supply and demand imbalance in a world with increasing wealth (for some) and insufficient housing. Allocating housing by how much people are willing to pay has a lot of problems, but if the price to get in is lower, there will need to be some other scheme (like a waitlist or a lottery) that determines who gets the apartment. These are alternative ways of being exclusive and a barrier to moving.
Nicer apartments will somehow be harder to get, regardless of what scheme they use to decide who gets them. A way to make this less of a problem is to have more alternatives that are also decent.
...eliminating absentee landlords would go a long way toward rationalising the market against actual demand rather than layers upon layers of derivative speculation, but like all paradigm shifts,...
...eliminating absentee landlords would go a long way toward rationalising the market against actual demand rather than layers upon layers of derivative speculation, but like all paradigm shifts, the devil is in the details...
I think this was the housing solution proposed in Ministry of the Future that we read for Tildes book club? Or maybe it was just reflecting the way people in Zurich lived, I could be misremembering.
I think this was the housing solution proposed in Ministry of the Future that we read for Tildes book club? Or maybe it was just reflecting the way people in Zurich lived, I could be misremembering.
In New York 2140 by the same author, part of the story takes place in the MetLife tower, which has been converted into a co-op. When I was reading it, I assumed it was inspired by the New York...
In New York 2140 by the same author, part of the story takes place in the MetLife tower, which has been converted into a co-op. When I was reading it, I assumed it was inspired by the New York version of a co-op, though.
In Germany, we have the Mietshäusersyndikat. It's structured a bit differently from a legal perspective, but in practice, it's the same idea: You own the house that you live in. The general idea is actually over 100 years old. I don't understand why it is still perfectly normal to profit from housing.
Germany has the more similar, I think, Wohnungsbaugenossenschaft as well.
https://archive.is/aOjk3
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Switzerland has a housing crisis and it’s a major point in politics right now. Rents are insanely high. A square meter in Zurich was 20k CHF to buy last I checked. If you want to buy a house in a less desirable area you still have pay a million if you’re lucky but more like two if you’re realistic. Mortgages rates are low though but still. There isn’t enough housing for everyone with barely any vacancies in most cities.
Even in America there are a few places like that, but they're vanishingly rare. The only one I can name is Atchison Village, in Richmond, CA. It's a brilliant model for separating housing from investing.
I'd be very interested in this form of housing. I did notice that the article only highlights the upsides but doesn't mention any downsides. I wonder what the downsides are of non-profit co-ops. I'm sure there's plenty of drama.
In my experience living or being in communal situations, things get toxic when certain members become free riders (tragedy of the commons effect, where negative externalities put out by free riders must be absorbed by good-faith participants) or really enjoy power and asserting control over other people's lives, since being a co-op board member is unpaid and boring work and isn't something most reasonable, well-adjusted people clamor to do in their free time — which mainly leaves the folks with too much time on their hands. You have to be verrry careful about who you allow in, and even then there are no guarantees.
I'd love to start a non-profit co-op but one where there's no board, only a paid manager who everyone agrees to hire or fire. That way, they're only motivated by money to perform their duties and no more and will be indifferent to the minutiae of residents' lives.
Im not sure that it's a downside on a broad societal level, but in areas with extreme wealth inequality, housing co-ops that used to be for poorer people will absolutely fill up with richer people if housing speculation starts really taking a bite out of the local housing market. At some point even the middle class will give up on getting a return on their house just to have secure housing, and so the prices will exceed the range where the original blue collar occupants can afford to live there. At that point, the organizing body will have issues with managing sociocultural differences between new and old tenants. It wouldn't happen so much in an overall saner housing market, but a single subdivision organized like this cannot cure the overall problems of the housing market.
One downside that occurs to me is that when someone leaves, they get back what they put in, but that might not be enough to buy into the next place if prices are rising.
That's a general problem with buying real estate. There is no guarantee that you get your money back when you have to sell.
I couldn't read the article because of the paywall, but in general, that problem shouldn't be too hard to solve. Everyone just pays a little more rent and the additional money is invested. The point is: The residents can decide how much money they want to put aside and they can get it back. If you rent normally, all the profits you invested over the years stay with the landlord.
I'm not saying it's necessarily worse than other solutions, but this doesn't eliminate controversy or politics. Residents can evaluate whether a proposed policy benefits them personally or not and vote accordingly.
As we see with inheritance disputes, dividing up a pot of money can result in lots of contention. Also, the Surfside condo collapse is a worst-case scenario where a contributing factor was that residents were unable to agree on expensive repairs.
Cooperative ownership (not sure what the correct term is, I mean different parties owning flats in the same house) has been a thing for a long time. The only difference here is that you can only own the flat you live in, so your incentive to take care of it should be very much increased compared to an owner to whom it's only an investment.
And yes, I can tell you from experience that it sucks, but it's still way better to fuck yourself than getting fucked by some faceless corporation who doesn't even have a concept of fucking people because its only purpose is to increase profits.
Democracy always sucks, but until we can create an all-powerful AI or find an alien species who want to take care of humanity as pets, we have to figure this shit out for ourselves.
What if there is no need to ever "buy up" the next rung on the ladder? Eg, age in place and have family live together and take over the unit.
Or, failing that, one invests the difference between rent and coop fees, so that the nest egg has grown alongside the static co-op chunk. If housing costs rise way faster than market investments then there'll be a gap. But if the pace is kept evenly, or there's a crash, or the owner needed liquidity during those decades, investing the difference is the superior choice.
People may want to move because the location or the apartment doesn't suit them anymore. Maybe they get a new job or want to move closer to relatives? And sometimes couples break up.
But I'm not saying it's necessarily going to happen, just that it's a possible downside that I thought of.
That's a good point that they could invest the difference, assuming they have the money to invest. But I think part of the point of making it more affordable is that many people wouldn't have the money? They might save it up over time, though, due to the lower rent. Having less of your net worth in real estate can be an advantage.
Right, because a mortgage is a liability, whereas an investment actually pays interests and dividends. A coop can also pool resources to tacklet capital projects and maintenance, and even if you hit a financial rough patch those projects are paid communally and can still get done.
And I know it's been decades of rising prices, but there are still many seniors who need to move but cannot afford the next downsize because their homes are old and not near a city. Liquidity always give more options.
...a substantial portion of the passive investment market is founded on real estate speculation, enough that i'm not sure even ethical funds can avoid contributing to the problem...private investment offers an alternative, of course, but unless you strike a wunderkind opportunity, most productive business models struggle to outpace inflation without dabbling in the same speculative-capital shenanigans as the public investment markets...
That might be one of those "bide your time until big enough to change the game" compromises.
But for most families, this isn't driven by ideological "boo speculations" but by "can I afford to retire". Which means investing in a fund that does worldwide real estate plus other industries is a far safer bet than one single house in one location.
I think it could be an improvement, but I don’t know how much the game can change?
I don’t see how you avoid supply and demand imbalance in a world with increasing wealth (for some) and insufficient housing. Allocating housing by how much people are willing to pay has a lot of problems, but if the price to get in is lower, there will need to be some other scheme (like a waitlist or a lottery) that determines who gets the apartment. These are alternative ways of being exclusive and a barrier to moving.
Nicer apartments will somehow be harder to get, regardless of what scheme they use to decide who gets them. A way to make this less of a problem is to have more alternatives that are also decent.
...eliminating absentee landlords would go a long way toward rationalising the market against actual demand rather than layers upon layers of derivative speculation, but like all paradigm shifts, the devil is in the details...
I think this was the housing solution proposed in Ministry of the Future that we read for Tildes book club? Or maybe it was just reflecting the way people in Zurich lived, I could be misremembering.
In New York 2140 by the same author, part of the story takes place in the MetLife tower, which has been converted into a co-op. When I was reading it, I assumed it was inspired by the New York version of a co-op, though.
Archive https://archive.is/V4Mes