Limited Equity Cooperatives

Under this approach – typically, but not exclusively, applied in the context of an apartment or other multifamily development – families purchase a “share” in the cooperative, rather than a standard property interest in the home. Members of the cooperative receive a right to occupy one unit, as well as a vote on matters of common interest. Cooperative members share responsibility for maintaining common areas and other areas of joint responsibility (e.g., maintaining the roof), as well as the admittance of new members. Share prices are set by formula (contained in the co-op’s bylaws, subscription agreement and stock certificates), which can be used to implement a shared equity formula.

One of the principal distinctions of this model is the concept of common ownership and shared decision making. Proponents of cooperatives also point to financial advantages stemming from economies of scale and the fact that the mortgage is held by the collaborative, rather than by individuals.

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  • ROC USA: Supporting resident owned manufactured home communities
  • ROC USA is a social enterprise that offers training, networking, and financing to help homeowners in manufactured home communities gain security through community ownership. ROC USA solves the financial and technical challenges faced by homeowners when they seek to acquire their manufactured home communities. Today there are roughly 3.5 million US homeowners in an estimated […]

  • Study of Social Capital and Housing Cooperatives
  • This 1998 article from the Fannie Mae Foundation’s Housing Policy Debate documents the practical benefits of “social capital” created through tenant ownership of Housing Cooperatives in New York City. The article presents evidence that social capital can be an effective component of locally sponsored low-income housing programs. It provides a model for measuring social capital […]

  • Asset Building Impact of a Limited Equity Housing Cooperative
  • This brief report by David Thompson quantifies the economic benefits and other outcomes for residents of the Dos Pinos limited equity housing cooperative in Davis, CA during the period between 1985 and 2005.  The report estimates the annual housing cost savings relative to renting and market rate homeownership, the return on an owner’s invested capital, […]

  • Shared Equity Homeownership: the Changing Landscape of Resale-Restricted, Owner-Occupied Housing.
  • sharedequityhomecoverhis 150 page report produced by the National Housing Institute (NHI) was the first to group together several models of resale restricted homeownership under the general term "shared equity homeownership." The report focuses on three models of housing tenure that use durable contractual controls to perpetuate the occupancy, eligibility, and affordability of homes that are owned and occupied by low- and moderate-income households: the community land trust, the limited-equity cooperative, and deed restricted housing with covenants lasting 30 years or more.

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