Gauthier Guerin works on housing co-operative development and is
a researcher on sustainable economics. He is a project manager at
Co-operatives UK for Student Co-operative Homes, a director of Catalyst Collective Workers Co-op, Rootstock Ltd and an associate consultant at Leeds Community Homes.
How did you get involved in the co-op movement, and in the housing sector?
I didn’t really start in the co-op movement through housing – I was interested in looking at different ways of organising, and organising social needs away from profit making, and towards maximising social outcomes. I got involved in Green Action Food Coop in Leeds as a student. Through that I understood how the consumer-controlled model structurally locks out the profit-making incentive and focuses on maximising the benefit to end users. That was very new to me and revolutionary. It meant there was a positive action, not necessarily just due to individuals being community minded, but one that was structurally embedded.
I was invited to a Radical Routes gathering, where I learned how those principles and ideas could be linked to housing and ethical investment. Then I moved into a housing co-op in Leeds and learned about legal structure, governance, financial models – for housing and for other types of co-ops, and became a co-op advisor at Catalyst Collective.
How was the response to the Student Co-op Homes share offer, and what is the next step?
Student Co-op Homes is an innovative model for which we got a really good response, from the co-op movement and from other ethical investors. The final figure is £320,000, more than three times our minimum target. There is a lot of support, definitely from the co-op sector, but I think it has also reached out beyond the movement; people who are sensitive to issues around student housing and higher education have engaged with it. We intend to do analysis of the support to help us raise more through this mechanism.
The next step is spending the money – we’re going to assess and revise our financial plan, purchase some properties – there is one lined up in Glasgow – continue our internal development, and get ready for another funding enterprise.
What are the challenges facing the housing co-op sector?
There are some regulatory changes we would like to see; for instance, in
Scotland we still don’t benefit from the exemption from HMO licensing on leased properties that we have in England (there is an exemption for housing co-ops in Scotland but it doesn’t cover leased properties). For Student Co-ops Homes this makes it harder to evaluate a project in Scotland. More importanly, the whole sector is quite badly hit by higher rates of stamp duty. We get penalised by extra 3% on any purchase and a huge 15% flat rate for any property over £500,000. Nowdays many properties are above that threshold, and this has affected several housing co-op projects trying to get off the ground.
Another challenge to the housing sector is a lack of resources, both in terms of finance and knowledge. It’s been a case, with every project, of struggling to find information, and reinventing the wheel all the time. There are resources here and there but they are not comprehensive. With the recent development of the community-led housing sector more resources are being created but that brings us to the other challenge – the financing of the sector. It’s very capital intensive – getting your hands on a property is very difficult because it’s hard to raise the money on the scale that is needed.
To bring long-term sustainability, there is a lack of support organisations; that is a symptom of the sector having been fragmented and incoherent. Housing co-ops developed independently of one another without coordination to scale it up. There is a need for new, federated models and we’re trying to address by developping model like Student Co-op Homes. Federations will allow us to mutualise financial resources from within the sector and the knowledge on how to do things.
Are there useful lessons from other countries and sectors for UK housing co-ops?
In countries where there are more housing co-ops, such as Switzerland, there are more secondary development bodies in the sector. Today, in the UK, we have many housing co-ops sitting on millions of pounds worth of assets that could be used for the sector to grow but there isn’t the mechanism for that to happen. In other countries they’ve done that better.
How can the movement best support housing co-ops?
We need to recognise the role housing co-ops can play in today’s key social challenge – which is that more and more people are struggling with housing needs; in my view the movement should therefore take a big turn towards housing and provides the resources needed for the sector to grow. But I think you can reverse the question: what benefits can housing co-ops bring to the wider movement, and to society as a whole? In the long term, once you invest in properties, the movement would acquire a lot of assets that could subsidise other co-op sectors. And it would bring back the co-op movement to its roots, to its initial success, to the nature of what co-ops are about – to bring social transformation by providing solutions to people’s day-to-day challenges. Housing is becoming more and more of a problem. The poorest get hit by this crisis really badly. That’s where the co-op model brings a viable solution – it removes property from private ownership into co-operative ownership; it becomes stable, affordable and not something to speculate against.