Latin America’s Co-ops Are an Alternative to Housing Crisis
For decades, countries in Latin America – from Mexico to Chile and Uruguay – have experimented with collective ownership of housing in an attempt to prevent the kind of crisis currently engulfing Britain's cities.
The mid-twentieth century saw unprecedented urbanisation in Latin America. Millions of migrants were left to fend on their own in cheap rental housing in city centres, or forced to find alternatives in peripheral areas.
Irregular land markets and occupations surged, giving birth to “favelas” in Rio de Janeiro, “pueblos jóvenes” in Lima, the “villas” of Buenos Aires, “ranchos” in Caracas, and “cantegriles” in Montevideo.
Life within this self-built, low-cost housing came with deep insecurity for residents — lack of access to basic public services such as potable water and sanitation, extensive distances from public transit and work sites, and insecure rights of tenure, often resulting in displacement by state authorities.
In this context, groups throughout the region began to explore models of collective ownership. Proposals sprang up in Mexico, and important advances in the construction of housing cooperatives took hold in Salvador Allende’s Chile until they were brutally destroyed by the Pinochet dictatorship. It was in Uruguay, however, where cooperatives prospered.
The Uruguayan Cooperative Centre (CCU), founded in 1961, advanced three pilot cooperatives for unionised workers. Inspired by their success, CCU leaders along with worker cooperatives and trade unions pushed for the recognition of this model of popular housing in the 1968 Law of Housing. Crucially, this facilitated state financing and along with it, access to land. An expansion followed and cooperative members, hailing from the labour movement, formed the Uruguayan Federation of Mutual Aid Housing Cooperatives (FUCVAM) as a “cooperative of cooperatives” in 1970.
Since then, the organisation has grown to comprise nearly 500 housing cooperatives. In total they’re home to more than 20,000 families, nearly 3 percent of the Uruguayan population.
The decisive impact FUCVAM has had in advancing the right to housing for workers in the country is linked to the model of cooperativism it has consolidated. Grounded in the principles of collective property, mutual aid, self-management, and direct democracy, the FUCVAM model resolutely departs from market-oriented treatments of housing and land.
The projects are financed through credits via the Uruguayan National Bank of Loans, often as subsidies towards loan repayments for families with incomes less than £1,800 monthly. But mutual aid plays a decisive role. Each family is responsible for contributing twenty-one hours weekly of work, which goes towards the collective construction of the housing project, regardless of who will be assigned a particular unit.
Tasks are assigned according to abilities and on completion, units are assigned through a lottery system, according to household size. This approach to production both reinforces solidarity between cooperative members and permits savings of between 15-20 percent of total project costs.
The nonprofit Institutes of Technical Assistance, whose operations are mandated and regulated by the 1968 National Housing Law, play an important role in assisting this work. These teams of architects, lawyers, and other professionals support the design and construction of projects under broader community direction. By law their involvement is mandated, but they can charge no more than 5 percent of the total project cost.
The practice of self-management extends from this culture of mutual aid and takes hold throughout the work of the cooperatives. Members take on important responsibilities before, during, and after the construction process. This is facilitated through an organisational structure that centres direct democracy through general assemblies and elected representation in key bodies, both at the local level and within the national federation.
The role collective property plays in establishing stability for families and in challenging capitalist notions of property cannot be understated and, perhaps, is what most distinguishes it from other popular housing experiences in the region. The cooperative obtains land in a collective manner and ownership remains that way — households have an indefinite contract for the use and enjoyment of their units, and a right to pass this down to heirs, but the housing and all communal areas remain property of the cooperative. If a family decides to leave the unit, they receive a payment for the hours of work they contributed plus the amount of the depreciated loan they paid into.
The State’s Role
The 1968 National Law of Housing was foundational to the broader political project FUCVAM took on. From 1973 to 1985 this was threatened, when a dictatorship took power in Uruguay and the Federation, along with other working-class organisations, faced persecution. In addition to denying lands to the Federation and delaying in the delivery of loans, in 1983 the regime passed an ordinance that sought to reclassify the tenancy status of the cooperatives away from collective property. FUCVAM led a campaign of resistance, including a payment strike against the National Loan Bank, helping awaken a broader popular movement that resulted in the dictatorship’s fall.
Afterward, the Federation — self-financed through the monthly quotas of cooperative members — continued mobilising to reestablish the recognition of collective property tenancy and to reinstitute the state land bank, along with new municipal land banks. The latter has proved to be a vital planning instrument for local governments.
In Montevideo, for example, large complexes have been developed that, by involving dozens of cooperatives, end up producing entire neighbourhoods such as the José Pedro Varela complex, Juana de América complex, or, more recently, the Pablo Estramín neighbourhood. In such cases, a portion of the cooperative’s plots were yielded for public education facilities, establishing infrastructure that benefits not only the cooperatives themselves but the surrounding neighbourhood.
At the national level the Federation has worked to deepen processes of political formation and capacity-building among cooperative members through the establishment of a National School of Formation, Enforma. Since 2013, the school has annually brought together upwards of two hundred cooperative leaders.
Exporting the Model
For Latin American organisations committed to advancing community-centred struggles for affordable housing that are rooted in deeper transformations, the FUCVAM experience has been a unique source of inspiration. The first connections were with the National Union of Popular Housing of Brazil (UNMP) and the Occupiers and Tenants Movement (MOI) of Argentina. Despite not having the necessary political, financial, and legal instruments to support the cooperative ownership of social housing, these movements have developed similar proposals in their countries.
At the end of 1990s, FUCVAM established a strategic alliance with the Swedish Cooperative Centre (today “We Effect”) to undertake a systematic transfer of the model to neighbouring Paraguay and eventually elsewhere. In Asuncion, a collaboration of the Committee of Churches for Emergency Aid (CIPADE), funding support from We Effect, and guidance from FUCVAM seeded the first mutual aid housing cooperatives in the country.
The early success of these first experiences permitted the Paraguayan co-ops to secure state financing for the further construction of homes. Understanding the broader political project, the co-ops emulated the federative model of FUCVAM and founded the Central of Mutual Aid Housing Cooperatives of Paraguay (CCVAMP). This influenced the approval of Law 2329 of 2003, which established the Administrative Framework of Housing Cooperatives as well as the Fund for Cooperative Housing.
In the early 2000s, pre-cooperative groups were also formed in Cochabamba, Bolivia, with workers from the informal sector. Early challenges included overcoming an institutional and economic context where “homeownership” dominated and adapting a model that emerged from Uruguayan trade unionism to a country of deep indigenous and peasant roots. As in other contexts, the articulation of a national association was necessary to maintain unity and exchange among the cooperatives and solidify a longer-term political project. The expansion of the model in Central America followed soon after.
At the heart of the exchanges is the knowledge that the mutual aid cooperative model must be part of deeper social transformation and in the fundamental role political struggle plays in the acquisition of state financing, access to land, and the legal protection of collective tenure. In this way, such a South-South exchange has consolidated a regional project that decisively breaks from market-oriented treatments of housing and land.
The FUCVAM experience, and the ways in which it has reverberated across the region, gives us not only inspiration, but a concrete path away from neoliberal urbanisation and to a right to the city.