There are many forms of Housing Co-operatives, but we like this definition, by Catalyst Collective, as it summarises the key principles on which they operate:
A housing co-op is, on one level, a group of people who have control over their own housing, without actually owning it personally. The legal structure, technically an Industrial and Provident Society, can be thought of as a separate person, who owns the property, takes out mortgages, and to whom the tenants pay rent. This separate person, however, only does what the members of the co-op tell it to!
A housing co-op is very similar to a housing association, but it is managed (either entirely, or mainly) by its tenants. If it is ‘Fully Mutual’ only tenants or prospective tenants are allowed to be ‘members’ and control/manage its affairs. (Our Rules are for fully mutual co-ops), Housing Co-ops, like all other Industrial & Provident Societies, are registered with the Registrar of Friendly Societies at the Financial Services Authority (FSA).
Once registered, the co-op can lease or buy properties, and then rent them, either wholly or as flats/bedsits/rooms, to its members – who pay rent to the co-op, which is their landlord. So, by registering a co-op, we create our own landlord, created for our benefit, with us, as members, collectively making all the decisions that need to be made – what property to buy, what rent to charge, whether to allow Jo Smith to join, what colour to paint our rooms, whether to install low-energy lightbulbs or water filters, etc. Co-ops allow us to reclaim aspects of our lives and distance ourselves from some of the hierarchical structures of society, without having to take part in the “home owner, this is mine, consumer” debacle. And they encourage greater co-operation with each other as tenants.