Self-managed housing cooperatives in urban areas -- Habitat for Humanity Int'l 1

Self-managed housing cooperatives in urban areas

By Viveka Carlestam and Gustavo Gonzalez

The self-managed housing cooperative model is equally applicable in urban and rural areas. This housing model, initiated in the late sixties in Uruguay as a response to the enormous and unsatisfied needs for adequate housing, is now being used in nine countries in Latin America, adapted to fit the local culture and legislation.


A housing cooperative is an organization where the members own the cooperative. Each member has a vote and the cooperative is run in a democratic manner. The members of the cooperative form the general assembly, which elects a governing board. The cooperative owns the land, the buildings including the houses, the green areas, the services and everything else that makes up the habitat within the cooperative.


This model has several advantages in fulfilling the need for adequate housing for the poor. It builds community and empowers women and men. It reduces costs to the dwellers and the lender and can simplify management.

A housing cooperative is built on one large plot of land, which is especially easy to manage in an urban setting. Housing models based on individual plots of land require much more administration and bureaucracy in already heavily bureaucratic countries in Latin America. The cooperative model reduces the bureaucracy, as well as administrative and transactional costs, because one entity (the cooperative) manages the land and the loan for the construction of houses.

Lenders reduce their risk since the entire cooperative and its belongings represent the collateral for the lender. Finally, several studies have demonstrated that the total cost of the houses is reduced by about 25 percent because the members build the houses and establish the cooperative through self-help.


  • Self-management:
    The people involved make all the decisions and have complete control of the process. Empowerment of the people is necessary for the model to function. Self-managed housing cooperatives are social enterprises, depending on the capacity and commitment of the people.
  • Self-help (mutual help):
    Self-help is not synonymous with self-construction. Self-help is a method by which every family in the cooperative contributes the same amount of time building all aspects of the cooperative. The members are initially trained in all the aspects of the construction process, and then they learn by doing, always with the guidance of a construction supervisor.
    This also means that cooperative members carry out the administration, the purchase of building materials and the payments. Managing all aspects of the construction of the cooperative is thus a wider task than solely building the houses. Specific task groups are organized in the cooperative to distribute the work and to clarify the roles of each member.
  • The right to use the commonly owned housing cooperative:
    People tend to think that the only form of ownership is private and individual ownership. We believe that alternative forms of ownership — cooperative or social ownership — are much more appropriate for vulnerable people.
    Private ownership has been shown to have some disadvantages for vulnerable people. Most significantly, it can create pressure to sell for a short-term financial gain in times of crisis. This means that the vulnerable lose the long-term benefits that an adequate home can provide.
    We believe that housing is a human right and a prerequisite to fulfill other human rights. If housing is only seen as a product, it can never fulfill the right to adequate housing of the vulnerable people. They will not be able to afford it.
    The cooperative ownership model creates a life-long right to use the house and the facilities of the cooperative through a legally binding contract with the member. The labor contributed by members has an economic value, built into the contract. If a member opts to leave, the value of his/her labor is paid out to him/her. The contract establishes the value of the loan to each member and how it will be repaid.
  • Technical assistance:
    Cooperatives require many types of technical assistance to successfully construct their housing cooperative. Multidisciplinary technical assistance teams are set up in the cooperative, including an architect, legal counsel, a social worker and an accountant. The team gives continuous training and monitors the whole process.

This model of self-managed housing cooperatives has been used for the last 37 years in Uruguay. More than 20,000 families now have adequate housing in the country. Most promising, this cooperative housing model builds more than houses. It builds communities of empowered people; it encourages personal and social commitment to maintenance; it reduces costs and eliminates intermediaries; and it is tailored to the needs of the families

Viveka Carlestam is regional director of the Swedish Cooperative Centre. Gustavo Gonzalez is regional program coordinator of the Swedish Cooperative Centre. Both are based in Latin America.