Cohousing-L Mailing List: Re: Affordable/Low Income options: Crowd source article needed- A US Cohousing Wiki?

[Alice Alexander (alicecohous]

Thanks Pare. Yes, affordability and creative financing models are of
interest to many!

The coho-l posts from Chris Scott-Hansen were packaged into a resource on
www.cohousing.org:
Creating More Affordability in Your Community: A Selection of Ideas
<http://www.cohousing.org/node/2977>

Also, if you "search" on affordability on the Coho/US website cohousing.org,
you can link to many resources on the subject. We are also working with
PFAC to better organize and make available these resources.
Alice Alexander, Coho/US Executive Director

On Thu, Sep 24, 2015 at 8:41 PM, Pare Gerou <paregerou [at] gmail.com> wrote:

>
> The topic of affordable cohousing is of interest to a great many of us, and
> we have rich resources in David Mandel, Chris ScotHanson, Sharon Villines,
> and so many others.  I wish there was a US Cohousing Wiki where people
> could crowd source an article on the subject authored by those with
> knowledge (complete with links to communities that have attempted or
> succeeded using the particular vehicle for affordability would make the
> article even more useful). I would think a Wiki would be very cohousing(y).
> In addition to the great information on Land Trusts, I have taken the
> liberty of reprinting an email from Chris ScotHanson I thought organized
> the basic list of affordability options -- I know it can take time to dig
> into the archives, and emails on this subject are scattered. Has the topic
> of a cohousing wiki ever been discussed?
> Pare Gerou
>
>
> Chris ScottHanson cscotthanson [at] mac.com via
> <https://support.google.com/mail/answer/1311182?hl=en> cohousing.org
> Feb 11
> to Cohousing-l
> Affordable Cohousing
>
> A SELECTION OF IDEAS FOR CREATING MORE AFFORDABILITY IN YOUR COMMUNITY
> [submitted to cohousing-l in weekly installments, for comment and input.]
>
> You’re probably tired of hearing about smaller units, standardization,
> simple unit plans, modest finishes, all with the goal of achieving more
> affordability.  Well it’s true, these all help, but there are other
> affordability strategies that are based on interpersonal relationships,
> community, and trust, that can be just as effective, if not more so.
>
> The strategies outlined in the series to follow have been collected over
> the past 25 years of doing cohousing projects across the US and Canada.
> Many of the strategies outlined below are what I call “internal banking.”
>  These internal banking relationships are magical when they happen, and it
> would seem they can only happen when there is a strong sense of  community,
> and trust.
>
> Each of these has been used successfully in one project or another.  The
> vast majority of cohousing projects that have been built in North America
> have included a number of internal banking elements which have allowed
> members with some resources to assist members with more limited resources
> to participate in the community.
>
> There are two primary ways of purchasing your home in cohousing.  In the
> simplest form, these are: 1) an all cash purchase, or 2) a mortgage from a
> bank, usually requiring some downpayment from the purchaser.  The mortgage
> is called a “take out loan” by the construction lender because it takes
> them out, paying off their loan to build the project.
>
> Your cohousing group can adopt some or all of the following strategies for
> achieving a measure of affordability within your project.  Some of these
> strategies work for some people.  Others work for other people.  Some of
> these strategies need to work together.  It all depends on needs,
> circumstances, pride, personal relationships, trust, liquidity, risk
> willingness, risk aversion, and/or time sensitive financial needs.
>
> 1. Internal Down Payment Assistance
> 2. Outside Down Payment Assistance
> 3. Second Mortgages
> 4. Co-purchase Options
> 5. First Time Buyers
> 6. The Reduced Monthly Condo Fee Subsidy.
> 7. Maintenance Reserve Reinvestment
> 8. Unit Price Buy Down
> 9. Design for Affordability - Capital Costs and Operating Costs
> 10.  Shared Units
> 11.  Community Owned Rental Unit
> 12.  Participating Nonresident Owners
> 13.  Purchase of One or More Units by an Outside Affordable Housing Entity
>
> In the coming weeks I will submit to cohousing-l an explanation of each of
> these strategies.  I hope, if you’re interested, that you will comment,
> edit, expand or help explain how each of these strategies can contribute to
> making cohousing more affordable, to more people.  Share your stories and
> we can add them to the shared wisdom.
>
>
> Chris ScottHanson
> Urban Cohousing Associates, Inc. <http://www.urbancohousingassociates.com/
> >
> Land Acquisition, Development Consulting & Project Management
> Ecovillages, Cohousing & Sustainable Communities
> On Wed, Sep 23, 2015 at 4:19 PM, David Mandel <dlmandel [at] gmail.com> wrote:
>
> >
> > Thanks all for the constructive debate.
> >
> > To reiterate more explicitly part of what I said:
> > In today's social-economic paradigm, owning a house is seen not only as a
> > obtaining a home but as an investment, a means of accumulating individual
> > wealth -- sometime the latter given more importance than the former. This
> > is fostered by many public policies (e.g. lack of rent control and
> eviction
> > protection; (environmentally disastrous as well) zoning favoring single
> > family homes; unlimited tax deductions for mortgage interest for
> > owner-occupants and landlords alike, retrograde property tax systems ...
> > and more. This distorts and undermines healthy social relationships,
> > creates precariousness and instability for most low-income people who
> have
> > no choice but to rent and severely limits mobility for lower-middle
> income
> > people who do manage to buy but may be locked in to what they have due to
> > economic necessity and legal restrictions.
> >
> > Decent, affordable housing needs to become recognized as a human right
> for
> > all and not a means to accumulate individual wealth. There are plenty of
> > others ways to accomplish the latter, though I'd like to think it would
> > diminish in importance (an obsession, really) under the social revolution
> > that would transform housing and that needs to make other basic human
> needs
> > -- a job, living wages, healthcare, education, culture, etc. -- into
> > guaranteed rights as well.
> >
> > Of course it will be a long-term struggle to achieve this, and I accept
> > that meanwhile we need to take small steps that can make lives better
> > within the existing oppressive system. But I believe it's important not
> to
> > lose sight of the big picture -- and to design/adopt small steps that
> will
> > more likely promote the larger transformation that's needed.
> >
> > A good positive example is community land trusts as co-owners and
> providers
> > of affordable housing, as described by Ann. They are permanent, as
> opposed
> > to many other forms of subsidy, don't require much if any further subsidy
> > after initial formation, and can be designed to enable modest
> accumulation
> > of individual wealth as long as that's a high value under capitalism.
> Land
> > trusts truly create affordable housing one or a few at a time, but if
> they
> > take off and proliferate, as they have in some places (Vermont is another
> > example), the change can start becoming qualitative.
> >
> > Does anyone have experience using the land trust model in a condominium
> > development, which is most typical for cohousing? It's possible that the
> > limited equity co-op model, which can accomplish similar results, is more
> > appropriate.
> >
> > David Mandel, Sacramento (Southside Park Cohousing)
> >
> > On Wed, Sep 23, 2015 at 8:28 AM, Ann Zabaldo <zabaldo [at] earthlink.net>
> > wrote:
> >
> > >
> > > I appreciate the good thinking and writing by those commenting on this
> > > thread about low-income cohousing,
> > >
> > > One of the things I observed in Denmark at a community that was built
> at
> > > the barest level because all of its members were “low income” (whatever
> > > that means in Denmark) was the community’s inability to move beyond its
> > > bare status.  The community members said they labored under the
> inability
> > > to improve anything or add anything.
> > >
> > > A mixed income community allows the community as a whole to keep moving
> > > forward.
> > >
> > > A solution I think has great merit …which may have already been
> mentioned
> > > … is putting all the “low income” or “affordable” units in a land trust
> > > PERMANENTLY with restrictions on resales PERMANENTLY.  This has
> > apparently
> > > worked very well in North Carolina which has an active and expanding
> Land
> > > Trust system.  Some owners in the land trust actually move from one
> land
> > > trust to another they like it so much.   The beauty of the NC system
> as I
> > > remember is that it can be a land trust of one to multiple to all
> houses
> > in
> > > a community.  It’s spread over the whole state.
> > >
> > > I really don’t believe grouping all low income into one neighborhood
> is a
> > > good idea if the units are to remain low income or affordable.  Isn’t
> > that
> > > how income ghettos develop?
> > >
> > > PS — not clipping any of this thread as I think it’s too rich to
> > truncate …
> > >
> > > Best --
> > >
> > > Ann Zabaldo
> > > Takoma Village Cohousing
> > > Washington, DC
> > > Principal, Cohousing Collaborative, LLC
> > > Falls Church, VA
> > > 703.688.2646
> > >
> > > > On Sep 23, 2015, at 9:46 AM, Sharon Villines <
> > sharon [at] sharonvillines.com>
> > > wrote:
> > > >
> > > >
> > > >
> > > >> On Sep 22, 2015, at 1:04 PM, David Mandel <dlmandel [at] gmail.com>
> wrote:
> > > >>
> > > >>  - Getting into a community is a great first step for a low-income
> > > >>  household. But expenses of upkeep and improvements tend to increase
> > > with
> > > >>  time, and a community dominated by market rate buyers may tend to
> tax
> > > >>  itself more and more without considering the effect on less
> > financially
> > > >>  able neighbors, or to adopt policies like paying more in lieu of
> > doing
> > > >>  work, ostensibly allowing choice -- but in fact, only for those who
> > can
> > > >>  afford it. Consciousness of promoting affordability, therefore,
> must
> > be
> > > >>  sustained beyond initial purchase.
> > > >
> > > > This is exactly why I think a community has to be built as a low
> income
> > > community from the start and not an economically diverse community.
> > > Diversity is like a rubber band. Wonderfully adaptable until it is
> > > stretched too far. Both middle and low income households have
> > expectations,
> > > requirements, and interests that can cause conflict. In the long run
> the
> > > groups become a burden to each other when forced to live by the same
> > rules
> > > at home. “At home” is the factor that changes the weight of equality.
> > "It’s
> > > in my home that I have to live with things the way other people live
> with
> > > them."
> > > >
> > > > To range from affordable to market rate is a 20% range in diversity.
> To
> > > include low income is a 40%+ range, but is actually much more. There
> is a
> > > threshold of basic income that all households have to meet.
> Discretionary
> > > spending in a low income household is all but non-existent. There is no
> > > margin for monthly condo fee creep. A 3% increase that the typical
> > > cohousing owner expects every year is a significant burden for low
> income
> > > households. Their incomes only grow when they take a second or third
> job.
> > > >
> > > >> Probably the best existing means to guarantee permanent
> affordability
> > > is to
> > > >> have individual homes be part of a nonprofit community land trust,
> > with
> > > >> ownership bifurcated between real estate and improvements -- though
> I
> > > >> suppose it would be tricky to do this with a condominium community.
> > > >
> > > > The problem with non-ownership, restrictions on resale prices, and
> > > subsidies is that low income people also need to build a sustainable
> > > future. We had a family move to Takoma Village as renters from a
> > community
> > > in California (not cohousing) that was a non-ownership model. They had
> > > physically built their home themselves and helped others build theirs.
> > But
> > > unless they stayed, they had no financial benefit from that. In their
> > late
> > > 50s they had no equity to purchase anywhere else.  When they moved
> closer
> > > to a better musical education for their daughter, they had a much lower
> > > standard of living and were having difficulty providing the musical
> > > education their daughter for which they had moved.
> > > >
> > > > The best way to limit prices is to build to the price. Still
> everything
> > > that goes up, goes up. It’s called capitalism. Why shouldn’t low income
> > > people have the same ability to become self-sustaining as other
> > households?
> > > >
> > > > In Manhattan there are huge numbers of rent-controlled and subsidized
> > > apartments. City-owned housing projects that are every bit as nice as
> > > market-rate housing. They not only have upper limits on income but
> lower
> > > limits as well—some are designed for middle income households. Many of
> > them
> > > much larger and nicer than most of us could afford. (Mia Farrow has one
> > on
> > > Central Park with many bedrooms and paid less than the rent for a 500
> SF
> > > apartment in much less desirable neighborhoods.) The system is open to
> > > abuse and aids those who certainly don’t need it as well as those who
> do.
> > > Incomes are measured when you enter the system, and not checked later.
> > Once
> > > in, you are in. But you are also trapped in the system, just like the
> > > homeless.
> > > >
> > > > I think there must be better ways to help people participate in the
> > > economy and to build sustainable lifestyles. Different architecture,
> > > different living standards, and understanding economics is one way to
> > make
> > > housing more available. If the household from California had both built
> > > their house and owned it, they would have also been building enough
> > > personal wealth to establish a sustainable lifestyle elsewhere. Like
> the
> > > rest of the people who own houses.
> > > >
> > > > Cohousing developments are real estate developments that
> significantly
> > > create wealth. But we need to figure out how to build wealth for the
> low
> > > income household as well as the middle income household. Income
> > inequality
> > > has to be fixed as well but all we can do here is focus on what we can
> do
> > > today. Protesting in the streets won’t house anyone right now.
> > > >
> > > > Sharon
> > > > ----
> > > > Sharon Villines
> > > > Sociocracy: A Deeper Democracy
> > > > http://www.sociocracy.info
> > > >
> > > >
> > > > _________________________________________________________________
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-- 
Alice Alexander
Executive Director
www.cohousing.org <http://www.cohous.org>
[image: The Cohousing Association]