LIVING IN A
HOUSING CO-OP
Anyone who knows housing co-ops will tell you that they are much more than bricks-and-mortar or a roof over your head. Housing co-ops are made up of people who form a close bond of association and work together to provide safe, secure and affordable homes for their members.
What is a Housing Co-op?
Even though many people are members of co-operatives (like credit unions, or Modo, the Cooperators or Peninsula Co-op), co-ops—and especially housing co-ops—are less familiar than limited companies and charities.
CHF BC and its member housing co-ops are part of a bigger community of co-operatives.
We’ve put together a video that answers some basic questions about co-operatives and how housing co-ops have some special characteristics that makes them a great alternative to more common rental and ownership models.
Watch the video here, or on YouTube and learn more!
If you want to hear a little more about how housing co-ops fit in with the broader co-operative movement, there’s a slightly longer version of the video, too.)
Co-op members
build strong
communities.
The Advantages of Co-op Living
Co-ops offer their members many advantages that are often unavailable in other forms of housing.
As a co-op member, you have security of tenure. That means you can live in your home for as long as you wish if you follow the rules of the co-op and pay your housing charges on time.
As a co-op member, you have a say in decisions that affect your home. You and your neighbours own your homes together, which means you have a say in how they are managed. Co-op housing is not public housing. Co-ops are self-governed, mixed-income communities, home to people of all ages and backgrounds. This diversity is one of the co-op movement’s greatest strengths.
Co-ops are communities in the truest sense of the word. While it’s common to hear people in other forms of housing say they don’t know or never speak to their neighbours, co-op members live and work together to create homes in active communities.
How Co-ops Work
Co-op members are not landlords or tenants. As co-operative owners, members work together to govern their association and manage their homes to foster strong communities.
Members elect a board of directors from among themselves to govern the co-op’s operations. Most co-ops also contract with managers to handle the daily operations and maintenance of their homes.
The board is elected by and accountable to the co-op’s members. Directors are volunteers who have a legal obligation to act honestly, in good faith, and in the best interests of the co-op.
Co-op Programs
Over the years, both the federal and provincial governments have created programs to support the development of non-profit housing co-ops.
The Community Land Trust also fosters co-op creation.
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The first federal co-op housing program was in place from 1973 to 1978. The Section 61 (formerly 34.18) program offered co-ops a 50-year mortgage at a fixed interest rate (usually 8%) along with a 10% capital grant that was earned over time. Housing charges varied between members. Some members paid more than the break-even 'rents' so that other, low-income members, could pay less (i.e. housing charges geared to income).
The second federal co-op housing program was in place from 1979 to 1985. Canada Mortgage and Housing Corporation (CMHC) provided co-ops developed under the Section 95 (formerly 56.1) program a monthly subsidy to assist a minimum number of low-income members. The amount of subsidy available varied by co-op. The Section 95 program was the most successful in creating co-ops: more than 160 in BC were developed. (Many benefited from agreement extensions that running between 2016 and 2020.)
The third federal co-op housing program was in place from 1986 until 1992. It featured an innovative financing instrument known as the Index Linked Mortgage, a monthly mortgage subsidy from CMHC, and rent assistance for low-income members delivered by the province and cost-shared with CMHC for 30% to 50% of each co-op's households.
The provincial government funded the development of 14 more co-ops with 1,047 homes under the HOMES BC program. HOMES BC co-ops house a mix of low- and moderate-income members.
The scheduled expiry of federal programs created uncertainty for co-ops across the country, as those expiries could mean the end of subsidies. Following a sustained campaign from CHF BC, individual co-ops and members, and CHF Canada, the federal government's Federal Community Housing Initiative (FCHI) included measures to extend support for low-income co-op households.
FCHI - Phase 1 offered temporary supports that targeted low-income households in Section 95 co-ops with operating agreements expiring between April 2016 and August 31, 2020. FCHI - Phase 2 (also known as the Rental Assistance Program) takes over From September 1, 2020 to March 31, 2028. It is open to the former FCHI-1 co-ops and other Section 95 co-ops as their agreements come to a conclusion. Other co-ops may be able to benefit from the Rental Assistance Program as it develops.
A growing number of co-ops are starting without a formal program offered by senior government. The Community Housing Sector is actively promoting co-op creation through its own resources. The Community Land Trust plays a major role and has its own rules in helping establish viable mixed-income communities.
Rental Assistance Program (FCHI-2)
The Rental Assistance Program—part of the Federal Community Housing Initiative, Phase 2 (FCHI-2)—is the successor to CMHC's Section 95 and ILM programs.
Co-ops exiting their original operating agreements or FCHI-1 support between September 2020 and the end of March 2028 may be eligible.
The program targets low-income households that can’t afford a co-op’s maximum housing charges without exceeding 30% of their household income. As income fluctuates, the level of support may also fluctuate, but the total number of supported households is generally fixed at the time of program sign-up.
The program may not be compatible with some grants offered by municipal governments.
UPDATE (March 2022): Rental Assistance Program (FCHI-2) Action Plans