Cohousing-L Mailing List: Cohousing ,Class distinctions and banks

[Rob Sandelin (floriferous]

Steven wrote about economics and class. My purpose is to pin it a bit closer
to cohousing. One of the definition points of cohousing is home ownership.
There are not any rental or non-owner cohousing communities that I am aware
of. Some cohousing communities, such as the one I live in, have rental
spaces, but the rentals exist and are controlled by the home owners.

Home ownership has always been a class distinction in America that separates
classes. Those we call the poor do not own their home. Most folks in the
lower middle class do no own their homes. At some point in the middle of the
middle class, the percentage of home ownership rises above the median point
and all the upper classes own their homes.

Owning ones home is the sign that you are in a different class. This of
course is nonsense, but this notion is deeply imprinted upon the American
pysche that home ownership is a sign of success.

Actually banks own most homes, and the banks determine whether you are the
right class to own a home. There are all kinds of social programs run by
governments to create situations, usually subsidies or guarentees, where
banks will accept people they normally would not. However, 90% of these
programs just move the line among the middle class. You have to make enough
money to be in the lower middle class in order to even get into any of
these.

But the true holder of the cards here are the banks who determine whether or
not they will give you a mortgage based on factors they have determined to
be in their best interests. And speaking of interest, interest payments  is
their reason for being involved in housing at all. Look at a typical 30 year
mortgage, and you will see that for the first 10 years you pay an
overwhelming amount of money to the bank in interest compared to what you
pay on your principle. Since the average person moves every 7 years, and
then starts a new mortgage, you can see how this benefits the banks.

So cohousing membership is at one level, determined by the bank(s) which
provide your project with mortgages. A great person, a wonderful community
member can and will be rejected by the bank if they don't have the right
credentials to buy a mortgage.  Banks also determine some of the structural
elements that you can build, if your project falls too far outside their
models, they will not fund your project assuming there are other
opportunities for them to make money doing something safer. This is why
non-traditional materials such as straw bale, cobb, etc have not, and are
unlikely to, be used in bank funded, capital project communities such as
cohousing.

There are many other kinds of communities, which do not have home ownership
as part of their definition. If you find yourself interested in community,
but not able to own a home, I would suggest investigating these other
opportunities. The new Communities directory comes out in a couple months
and there are hundreds of communities listed at www.ic.org. There are some
absolutely wonderful and incredable places to be in community with folks
that don't cost any buy in, or just a small buy in. I know several places
looking for members in NW that are not cohousing, and need energy.

There are lots of cohousing groups which try to do some mediation for lower
income first time home owners. It is in my observation common at first for
forming groups to pay some lip service to this idea. Many do not follow
through with the processes needed to accomplish this and so drop the idea
once they own a site, thus abandoning, however painfully, those members who
were depending upon it. This is not some evil plot, just the reality of
being a developer. Once you own a site, usually your timeline changes to a
specific length to get loans, permits, etc. The energy of the group goes
into all the other aspects of developing, and the affordable grants, loan
programs and such don't get any energy, thus they are not initated. There
are groups that did follow through, and so it can be done, its just another
hard thing to add to an already very difficult process.

More than one group has gone bust when getting to looking for a site because
they found they had no real assets or ability to be land buyers.

Like I said, cohousing is not the only game in town. Community is there for
people who want it, whether you are bank certified or not. Its now the new
mellenium, what are you waiting for?


Rob Sandelin
Northwest Intentional Communties Association
Building a better society, one neighborhood at a time