Real Utopias: Switzerland’s Housing Co-ops

As countries across Europe struggle with housing crises, Switzerland's innovative housing co-operatives point the way towards an alternative.

Hunziker-Areal cooperative housing development, Zürich.

Ideas about how to deal with the housing crisis in the UK often get caught between two opposing problems. On the one hand, the absence of the state as a major provider is still keenly felt nearly forty years after it was barred from the sector. Increasing public affection for the ambitions of post-war council estates fuels dreams of somehow returning to a situation where the provision of quality housing was a relatively non-partisan national goal.

But on the other hand, the fact remains of the near-total dominance of the large housebuilders, who produce around 80 per cent of the new homes built each year, and whose stranglehold on the market after local governments stopped building means that they can manipulate supply almost at will. Complaints about planning ‘red tape’ notwithstanding, they are in the position where they almost completely control the market.

Because of this, there is great hunger for alternative methods of procurement. Yet despite the media prominence of a trickle of self-builds, creative re-use, and collectives, these are so rare that their real impact is negligible compared to the interest that they generate. Non-profit housing in the UK is dominated by charitable housing associations but their role is controversial, especially concerning their involvement in ‘stock transfers’ where council estates were taken off government books in recent decades. Recently, even the housing association’s position as builders of nominally affordable housing has been eroded by moves into the market by for-profit providers.

But there are examples, not too far away, where non-profit actors outside the state play a large part in housing provision, with interesting lessons for Britain. Switzerland’s version of housing co-ops, the Wohnbaugennossenschaften, are responsible for more than 5 per cent of the entire country’s housing stock, and nearly a quarter of that of the largest city, Zürich. They are non-profit entities, and they range from developments of a few units to over a thousand dwellings.

What are the advantages of this system? Most co-ops are initially financed by a mix of sources: first of all, the members of the co-op, who pay an equity deposit which is refunded (with interest) on leaving. This simple factor alone largely prevents speculation. Banks have well-developed systems in place for mortgaging the construction costs of the co-op, and there are incentives from the government that reduce the risk on this lending.

Most co-ops are comprised of the residents who occupy the buildings, but in cities like Zürich they are also required to provide protected low-cost rental apartments as part of their provision, and while not exactly council housing, these can ease pressure on care and other state services. The rental income from the apartments in a co-op is restricted to cover investment debt repayments, running costs, and repairs, and generates cross-subsidies for the public facilities that the developments are often required to offer.

Co-ops offer rents that are relatively cheap compared to those considered ‘affordable’ housing in the UK, sometimes offering a reduction on market rates of up to 40 per cent, and in line with Swiss tradition, the residents and members are heavily involved in democratic decision-making. Diversity of age and class is encouraged, and the co-ops regularly provide forms and sizes of dwelling that the open market isn’t much interested in building.

Wealthy Switzerland is a unique case, but there are other aspects of the co-op system that we might pay attention to. In Zürich, each co-op development is required to run an architectural competition to determine its design. Young graduates and elderly professors of architecture compete against each other in these competitions, which go a long way to sustaining the remarkable architecture ecosystem in that country — one of the best in the world.

This isn’t about beautiful facades or fancy materials, but about innovation and progress in the design of housing, something rarely seen in the UK since the 1970s, and in desperate need as domestic life changes so quickly. In Britain, new houses are extremely small and follow deeply conservative conventions in the layout of rooms, public areas, and circulation spaces. But in Switzerland, a healthy competition system means new ideas can be examined and discussed in a much more public forum, and opportunities for vital research and development in housing and environmental design are made much more practical.

The constraints on land in the UK, along with huge regional inequalities and the pressure-cooker market of the South East add a level of difficulty that would make direct transfer of ideas and methods from one situation to the other awkward. Squeezed out by homeownership, social, and private rental tenure, British housing co-ops tend to be tiny. But the Swiss example shows how these non-state and non-capitalist actors can build quality housing at a mass scale, if they’re encouraged — and that they can create a model of housing provision that moves beyond speculation into something more democratic and innovative.