Cohousing-L Mailing List: Re: The economic realities of Cohousing development

[Diane Simpson (coho]

Here are some detailed points on why I think affordability *has* to be
included in the definition of cohousing:

>Up to this point, cohousing development in America  has been done by: 1.)
>Middle class people with money to invest upfront or  2.)professional
>developers.

This is true. And it can't continue along this path because it's a dead end.

>A group meets and decides to do an affordable cohousing project. Who is
>going to carry the costs for the initial development work? These costs
>include, securing a building site, planning and zoning costs up to working
>permitable drawings, plus legal costs, and some other consulting fee?

Here is where you and I come to a philosophical parting of the ways. I do
not believe that in the future "a group" is going to meet and decide to do
an affordable cohousing project. I believe that developers will decide to
do an affordable cohousing project because they will begin to understand
(like Jim Leach already has) that this is a good money-making opportunity.
"The group" will become more akin to a focus group and less akin to a board
of directors. Does this mean that the houses will become more cookie-cutter
and less individualistic? You bet. Do I think this is a worthwile tradoff?
You bet.

>Cohousing as it has become established in America is real estate
>development, which is not cheap, nor particularly easy. And so, to do
>cohousing successfully, based on what I know of the built groups in America
>takes a couple things. 1. Money and 2. People with a high level of drive to
>succeed under difficult circumstances.

It is true that cohousing has always been this way in the past. But to that
I say "Why always look to the past? You can't move ahead if you're looking
backwards!"

>Over the years I have the privilege of  visiting a fair number  of cohousing
>communities. From my experiences, Currently, cohousers are people that are
>almost uniformly middle class, college educated, who have good paying jobs.

I guess you haven't been to Southside Park. Gotcha there, Rob!


>Real estate development excludes people that  have no assets, are not
>mortgagable, and have little drive to succeed. That is the reality. New home
>real estate  development does not happen by magic, it takes money and
>commitment.

I think "are not mortgagable" is the key phrase here. I think there are a
lot of people out there who *are* mortgagable but they cannot afford the
20-30% downpayment that has been required to buy into cohousing in the
past. Once banks and the big secondary mortgage market realizes that these
houses *are* in demand the mortgagablity of cohousing homes with smaller
downpayments will start to become a reality.

>I do not know of any real estate development companies that provide start up
>funds for affordable housing, carry all the costs, and then find grants and
>funding for people. But I would  love to find one and steer them to a couple
>cohousing projects I know that are struggling.

Grants may be a part of cohousing in the distant future but I don't see
that happening any time soon. By the way, when I talk about "affordable" I
am not talking about subsidized housing--I'm talking about
first-time-homebuyer programs and soft-second programs--the traditional
homeowner affordability programs that are offered through banks. As an
aside, the HUD guidelines for Boston state that people with incomes of up
to 120% of median can be considered for some HUD programs because housing
costs in Boston are so high.

>So in my opinion, cohousing will not succeed as affordable housing for
>anything but a small minority of units, which currently I estimate to be
>about 10%. Because there is little start up capital to get the project real
>enough to secure a site and permits enough to carry it to bank financing.
>And so far, there is limited  interest from affordable housing organizations
>in cohousing because it is way too demanding.

It's true that there has been little interest on the part of affordable
housing organizations in the past. But this may change. When I sat through
that "Quality of Life" workshop the other day at the Roxbury Master Plan
meeting, the people were all saying things like "We want a neighborhood
where the neighbors know each other" "We want a community center where the
seniors will have someplace to go" "We want a safe place for the kids to
play" Well- Duh! It didn't take me very long to figure out that cohousing
offered all of these things, but nobody had ever heard of it. So of course
I got up and gave my little speech.

>Philosophically this sucks, but It's the reality as I see it. And I am not
>personally optimistic that things will get  much better as far as affordable
>housing goes in the US. It certainly does not seem to be talked about much
>by the  politicians in my area and I have little trust or belief in my
>government to do such things.
>
>
>Rob

Well, yes and no. I am not that optimistic about the government's ability
to do anything much these days, that's why I'm voting for Ralph Nader. And
for all of the Democrats out there who are waiting to pounce on me about
this, let me say one thing: save your electrons. This is not a "protest
vote." This is a real vote about very real, very tangible issues. Nader is
the only candidate who supports full funding of the public education
system, REAL campaign finance reform, the right to organize a union without
fear, single-payer universal health care, an end to the "war on drugs", to
stop NAFTA, GATT and the WTO, to end global warming and environmental
destruction, to stop the corporatization of America, is against capital
punishment, and wants to cut military spending.

These things are all interconnected. A bloated military budget cuts into
the amount we can spend on Medicare and Medicaid. "Free trade" agreements
merely allow corporations to move capital wherever they please, to destroy
the enviroment of the countries that they move to, and to destroy the
abilities of workers to unionize.

I see cohousing as one small way to improve the world. But if the world
goes up in smoke as soon as my cohousing community gets built, well, what
will have been the point?

--Diane(:^\





    @@                 coho [at] world.std.com                   @@
   @@@@       Diane Simpson  http://jpcohousing.org        @@@@
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