Stop wasting your- rent - set up housing Co-operative

Cautious_Optimist

deannatrois wrote: »

Read the Thread, thought great idea, sick of the way private LL's operate myself but this para is revealing and shows you don't want to set up a co-op at all. You want to be in control, not dealing with 'underlings', people who may be slightly different to you. You want to be a Landlord lol.., just don't have the money to do it on your own lolol.

I thought Lord Baltimore was being unpleasant but after reading that para I think he's got it in one lol.

So how many LLs are limited companies?

mohawk

Cautious_Optimist

If these existing co-ops are successful and expanding, then why doesn't the OP join them?

My Answer :

I could join one of the existing co-ops if I wanted to, but my idea is to set up something to enable huge numbers of other people to set up their own co-ops all over the country too in order to radically alter the miserable nature of the rental market.

This rental market provides terrible standards of accommodation and violently unpleasant treatment to tenants. Tenants are just ripped off by rapacious landlords.

Also, I am fuming with rage at the total control the banks have over the providing of mortgages for home purchase and the way the banks rip people off & prevent huge numbers of people from having mortgages. Like older people or people with ‘bad credit’, often a very incorrect supposition.

My idea, implemented properly, is ultimately intended to effectively enable anyone to end up being able to buy their own home without ever having to apply for a a mortgage and be refused or ever having to have a huge deposit to buy a home.

Just as a normal tenant today is paying a rent to the private landlord which pays the landlord’s mortgage, so too will the same thing happen within the co-op. But the big difference then is that instead of the landlord pocketing the profit, the tenant gets that benefit, being ultimately able to own the same house if he wants to.

To explain it really simply, just as an illustration. Normally a landlord might have his mortgage fully covered by his tenant and the mortgage would be paid off in, say, twenty years.

When the mortgage is paid off the landlord owns 100% of the property.

In the case of the co-op it is exactly the same and so the co-op can decide whether to give some or even all of that profit to the tenant, or it could simply say to the tenant, thanks very much for paying rent for twenty years so the co-op now owns this home outright. You can now live here in perpetuity without the need ever to pay rent again. We, the co-op, will always ‘own’ the property though and when you die we can get another tenant.

That is just a simple example which indicates a variety of other possibilities too. There are many, variations and a particular method of arranging it so tenants can remain for only short periods of time and still be able to recover rent they have paid.

The other factor is social housing which is an utter, sick, joke in many ways. In particular the fact that councils and the government think it’s OK to torture social housing tenants and inflict all sorts of stress on them by means of bedroom taxes and other forms of bullying and eviction; like when the child of a single parent grows up & leaves home, that single parent is shoved out of the tiny two bedroomed home & forced into a one bedroom, even smaller property, often just a bedsitter with no room to hang on to their possessions even.

It is a disgusting and immoral way to treat people.

Another thing is that billions of pounds of housing benefit from the taxpayer is paid by the government into the pockets of private landlords to pay for their mortgages which buys their rental properties which makes them richer at the expense of the taxpayer and the long suffering tenants.

As a result of this evil system which looks as though it is a scam deliberately organised by the government to make landlords richer, more and more private landlords are piling into this grubby buy to let market which has the effect of snapping up the cheaper properties first time buyers wish to buy and also increasing prices in the property market. Both of these contribute to preventing first time buyers from ever being able to buy any home at all.

And why taxpayers money should go to private landlords to provide often shoddy, substandard housing instead of that money being used to buy housing which remains in public ownership (like it used to) I cannot imagine - unless it is just another expression of total corruption from our spectacularly unpleasant government.

lulalola

Mohawk, I think the lack of interest you're finding is not because people aren't "bright enough", it's because many tenants are like me and just not interested in this idea. I rent because it suits my lifestyle of moving on every so often to a new location for work, and because I simply want a place to live by myself; I don't want to commit to anything or any period of time past the intial six months that I have to, I don't want the hassle of making decisions or sorting repairs (especially not alongside others), and I don't see renting as a "waste of money" as it keeps a roof over my head and allows me to move on at short notice with minimal hassle. As others have said, your plan sounds complicated and already I'm thinking if I want that level of complication I'll just buy my own place (which I could afford to, I just choose not to at this moment in my life). I think you'll find many other young renters like me feel the same.

mohawk

Cautious_Optimist

If these existing co-ops are successful and expanding, then why doesn't the OP join them?

- (already answered)

And if the British people are not keen on housing co-ops, then how are the existing ones successful and expanding?

- (co-ops have hardly received any publicity. The British people who already actually know about co-ops and are involved in them are keen on them & that is why they are expanding)



So the co-op owns several properties, but all in one location?

- (no, a co-op can own properties anywhere and it is my ambition to make this a nationwide proposition so that anyone anywhere in the country can have a home within this co-op idea.)

How does the co-op charge lower rent than a LL?
How does it reduce it's maintenance costs etc to enable this?

- (the maintenance costs of a home will no different, they won’t be reduced in some magic way to enable lower rents.

But rents can be lower just like when an ordinary homebuyer buys a house with a mortgage he always pays the same amount (putting aside the fluctuations in interest rates) because the amount he borrowed hasn’t increased but the value of the house has increased because of inflation and separately from that the homebuyer’s salary has also always increased because of inflation. Inflation has been around for at least two thousand years, so is unlikely to ever go away. All this means the annual cost to the homebuyer reduces a bit each year, eventually becoming very low indeed as the mortgage term progresses.

This process also applies to the co-op and so rents could also reduce in the same way.)

So if I wanted to join one, I would pay rent, but also own a share of the co-op company?

- (yes)

And what do I get for my shares? A dividend?

- (yes)

It sounds very complicated.

-(no, simples really, as Mr Meerkat says.)


If I wanted to share ownership of a house with others, then why not just get together and buy a four bedroom house with three other people, each of us putting in 25pc?

- (nothing stopping you at all. But you would be going some way to doing the work of actually setting up an infant co-op too. One day that infant co-op might indeed grow up into a big, powerful Daddy of a co-op which is easy for other people to join and which has the financial clout to buy possibly as many properties as it cares to. Look at how big the Nationwide is. That’s a co-op with small beginnings. The Ash or Argyle St co-op mentioned in an earlier post is perhaps a teenage co-op with only 22 properties owned and buying another handful in bulk as we speak. It’s on it way to becoming a big Daddy co-op too in a few more years)


It mentions a 10 bedroom house. Surely that can only exist as either a very large family house or as a hotel / B+B?
Anything else seems unrealistic to me.

- (I haven’t been talking about a ten bedroomed house, thats obviously some other thing, possibly the Ash co-op you might be referring to, and they would have bought it because a load of people wanted to buy a big house to share it. What’s the problem with doing that. A lot of people share houses. That doesn’t mean everyone has to share with others and the Ash co-op has loads of single tenanted homes as do most co-ops.)

British people don't even like flats, due to the lack of individual control. British people want to own their own house.

- (Yes of course people want to own their own house & this is a way of helping people who cannot afford to buy a house to be able to do so instead of just paying rent to make landlords richer and having nothing to show for it and being unable to save for a deposit to buy their own house.

This is designed to turn rent into a deposit or even full ownership. That is the whole point of the exercise. And the tenant will also have far more control than ordinary tenants with private landlords. As long as rent is paid etc the tenant would effectively have also the same control he would have in his own home.)

mohawk

lulalola

Good for you.

But there are plenty of people who cannot buy homes and who do not like wasting their rent to help make a landlord richer. They would rather like to make themselves richer be using their money to actually buy a house of their own.

t0rt0ise

There's lots of groups of housing run by co-ops. One estate of 40 houses I know of in Canterbury started off with lower rents than the adjoining HA estate (where I lived) but are now pretty similar.

http://www.cds.coop/co-op-directory/az-listing/warwick-housing-co-operative-limited

There's another bigger co-op estate the other side of Canterbury too. There's many all around the country. Maybe the OP should get housing with one of the establised co-ops rather than attempting to start a new co-op.

Pixie5740

I wasn't being sarcastic, I was offering a possible explanation as to why someone who claims to be a student of the law can only offer up insults when people disagree with, or questions them.

mohawk wrote: »

I'll see if I can find a few spare brain cells for all you people to share amongst you who can't seem to understand what I have written.

mohawk wrote: »

Me saying I haven't found people bright enough yet is not an insult to any individual anywhere. It is a standard phrase many normal people utter in different situations without complete idiots making a special effort to go out of their way to imagine it is an insult to them as an excuse to hurl mindlessly childish & pointless abuse at others.

It is insulting to say people aren't bright enough to understand your brilliant idea as though you are some intellectual heavyweight. To then go on an further insult people who find it insulting just goes to show what a complete ignoramus you really are.

mohawk wrote: »

This rental market provides terrible standards of accommodation and violently unpleasant treatment to tenants. Tenants are just ripped off by rapacious landlords.

So as a landlord of 30 years who has seen 100s of tenants, is this how you treat them? Do you consider yourself to be a greedy landlord? Is it as jjlandlord has suggested and that you've had some kind of Scrooge like epiphany?

You shouldn't judge every LL by your own low standards. Yes landlords let properties to make money, the same as someone opens a restaurant to make money, or a wool shop, but that doesn't necessarily make them greedy.

mohawk wrote: »

Also, I am fuming with rage at the total control the banks have over the providing of mortgages for home purchase and the way the banks rip people off & prevent huge numbers of people from having mortgages. Like older people or people with ‘bad credit’, often a very incorrect supposition.

Yes I can see how totally ridiculous it is that banks don't want to lend money to people who have a history of not paying back. That makes total sense. (For clarity, that was sarcasm)

mohawk wrote: »

Another thing is that billions of pounds of housing benefit from the taxpayer is paid by the government into the pockets of private landlords to pay for their mortgages which buys their rental properties which makes them richer at the expense of the taxpayer and the long suffering tenants.

Was this your business model before your epiphany?

I'm not saying housing co-operatives can't work for some people. However, I think you really need to work on your pitch as I don't think the reason people haven't joined you is because they aren't bright enough.

Until then....

Cautious_Optimist

OP thanks for your reply.

I think people may struggle to understand exactly what they are getting for their money when, and if, they join one of these housing co-ops.

I personally think that individual BTL will reduce in popularity over the next few years, due to the increasing bureaucracy and regulation involved.
At the moment it seems to be a "cottage industry".

I think holiday lets and B+B will continue to grow.
I think there is something different about providing a person's own primary residence though.

The politicians seem to be moving against the BTL LLs, but interestingly towards the resident LLs with lodgers...?

Personally, I believe large scale HA type LLs will grow and replace the private LL + letting agent setup.

I believe pension companies etc will buy up more freeholds and these large "housing companies" will lease buy long leases of 5-10 years and take on the sub letting and tenancy management with full time staff.

I also believe these larger Housing Companies will start working more closely with employers.

I could be wrong of course. But if you compare housing to other service sectors, like grocery shopping, you can see how large corporations easily gain an advantage over small independent shops...

A lot of the small business tradesmen I speak to are certainly keen to gain contracts with housing associations.

Large housing companies can also benefit from economy of scale.

But none of this will reduce the popularity of home ownership amongst the British people, especially the geographically static.

mohawk

Pixie5740

I can't conceive of a more silly post than post 38.

Pixie5740

Are you sure about that? There are several pieces of evidence on this thread, authored by your good self no less, that would indicate otherwise.