8 ms·

A 'third way' between buying or renting? Swiss co-ops say they've found it

ori_b 1y ago
Oh. Company towns.
- renewiltord 1y ago
  [flagged]
pstuart 1y ago
This should be embraced in the US as well. And we need it now, more than ever because of how the price of housing has jumped so much and will only get worse as private equity continues to hoover up housing stock.
- post- 1y ago
  We could also rein in private equity? Culture Study had a great episode about PE [0] recently, with some explanation of what started it and, if I remember right, some gestures towards how it might be brought to heel — or at least made less bombastically awful for most people. [0]: https://culturestudypod.substack.com/p/how-private-equity-destroys-the-companies https://culturestudypod.substack.com/p/how-private-equity-de...
  - jeffbee 1y ago
    PE has nothing to do with any of it. They are totally up-front, even in their prospectuses, that the only reason they are in this game is because witless dupes (paraphrasing) in local governments are too stupid to build houses. If we would build anything, they wouldn't be in the game.
  - whimsicalism 1y ago
    Private equity has lots of benefits that are never discussed because they make good bogeyman. Existing management is not always good, and I do not benefit from companies employing unnecessary workers and passing the price through to me.
    - pstuart 1y ago
      They very well may. But they are notorious for strip mining and killing viable companies, because they do.
- sokoloff 1y ago
  This (and other interventions) will help to the extent that they cause more housing to be built. If they will more than another change, it will durably improve housing costs. If it doesn’t make more housing, but only changes how it’s bought and financed, it’s probably just noise and distraction.
- whimsicalism 1y ago
  Private equity is not the cause of the housing crisis in the US and all they are doing is amortizing rental demand. Without private equity, the demand would still be there. Shocking how often this needs to be repeated.
wslh 1y ago
https://archive.is/aOjk3 https://archive.is/aOjk3
awongh 1y ago
This article is really low on actual facts about how these co-ops can actually operate. I feel like the problem in the US isn't necessarily that the government won't directly pay for these kinds of things like they do in Switzerland, but that it's very very hard to finance a co-op, possibly illegal (that is, you wouldn't have the same legal protections a condo does). I would be curious to see the finances of the buildings they mention in the article. Assuming that you could arrange the two major financial aspects: 1) financing at a level of a normal home loan 2) cut out the real estate developer profit margin, I wonder if a co-op model would become viable in the US. Edit to add: Intuitively it seems like the math could work out, if you figure that a co-op takes the appreciation of the real estate out of the picture for the people living there, and that being able to rebalance that lost value towards the initial cost or towards future costs would be a trade-off normal people would be willing to make. In that sense a co-op is more like an alternative to renting rather than an alternative to home ownership.
- yupitsme123 1y ago
  I think San Francisco has something like this with their Below Market Rate (BMR) housing program. You have to be below a certain income to be considered, and basically you get to pay a fixed monthly rate to "own" a place that can only be sold for a fixed amount. It always just sounded like rent to me. I think that NYC's co-ops (TICs in San Francisco) provided an interesting alternative model. They usually require owner-occupancy, can't be rented easily, and are difficult to finance. These restrictions eliminate investors and speculators, and shields the the units from the inflation that happens from fed intervention and super low rates. The result is that they're usually priced a lot lower and appreciate more slowly than they would be if they were condos.
  - awongh 1y ago
    TICs are a scam though. They are just condos with less legal protections for the relationships between the tenants. They don't solve any of the cost of ownership issues or deal with the idea of appreciation of the value of the real estate. afaik it's actually much worse because you're combining the appreciation of the asset, but you can't sell as easily as with a condo.
deleted 1y ago
[deleted]
fxtentacle 1y ago
This is becoming more popular in Germany, too. In effect, future renters pool their money into a non-profit which will then build affordable housing, to be owned and inhabited by them. https://en.wikipedia.org/wiki/Housing_cooperative https://en.wikipedia.org/wiki/Housing_cooperative
mg 1y ago
his apartment ... two bedrooms, a small office, a south-facing balcony and it costs 1,760 francs (about $2,200) a month, around half the typical rents I always find it impossible to grasp/compare rents if there is no mention of the size of the apartment. For all I know, this could be a 60m² apartment with 3 smallish rooms which goes for something like half of that price in Berlin: https://www.immobilienscout24.de/expose/161188147 https://www.immobilienscout24.de/expose/161188147 Or it could be a luxurious 300m² apartment with 3 big rooms that goes for three time that price: https://www.immobilienscout24.de/expose/157476995 https://www.immobilienscout24.de/expose/157476995
- andimm 1y ago
  It is mentioned in an image description: > Claude Waelti’s 1,180-square-foot apartment in Lausanne costs around $2,200 a month. The rent has barely increased since he arrived in 1991. So about 110 square meters which is pretty good for number of rooms in Switzerland.
  - deleted 1y ago
    [deleted]
ExxKA 1y ago
This is a big thing in Denmark and has been for several generations. https://da.m.wikipedia.org/wiki/Andelsboligforening https://da.m.wikipedia.org/wiki/Andelsboligforening The issue with them is that the loans to build the properties are socialised, so if the other members can not pay the debt, the entire loan is the responsibility of those members who can. Also, the incentives of a cheaper than market rate flat, means that corruption and nepotism is rampant in those buildings. It is not pretty in practice.
- awongh 1y ago
  > Also, the incentives of a cheaper than market rate flat, means that corruption and nepotism is rampant in those buildings. Maybe there's some middle ground between socialized housing that incentivizes people to take advantage of overly cheap housing, and a 100% capitalist USA style housing market where lots of people are 1 missed paycheck away from being homeless.
  - FirmwareBurner 1y ago
    >Maybe there's some middle ground Maybe there is, but human history proves we can't easily reach a equilibrium where everyone has it equally good, due to human greed, envy, cronyism and corruption, making any kind of equality just a fairytale utopia. So we just bounce between extremes because as always, few people strive have it good and the rest get screwed over in order to pay for the privileges of the select few. There will always be haves and have-nots, no matter how many thumbs the government puts on the scales to try to balance things out for everyone which only breaks things for the worst as they distort economic reality. Meanwhile from the numbers I gathered, despite the "evil capitalism", statistically by most metrics, Americans enjoy the highest purchasing power for home ownership in the developed western world by a large margin. So Americans love to complain too much, but the truth is by the numbers, most of the world has it much worse than they do. 1. Demographia International Housing Affordability | Lower median multiple = higher affordability (2025 Edition) Singapore 4.2 United States 4.8 Ireland 5.1 Canada 5.4 United Kingdom 5.6 New Zealand 7.7 Australia 9.7 2. World Population Review: Housing Affordability Index | Higher index = higher purchasing power (2024 Data) United States 3.3 Denmark 2.1 Belgium 2.1 Ireland 1.8 Luxembourg 1.8 Norway 1.7 Sweden 1.7 Finland 1.7 Spain 1.7 Netherlands 1.7 Germany 1.5 Switzerland 1.5 3. Numbeo Property Prices Index | Lower ratio = higher affordability (2025 Mid-Year) United States 3.44 Germany 8.5 United Kingdom 8.71 Italy 9.04 Canada 9.45 France 9.89 Japan 11.34
Refreeze5224 1y ago
It is refreshing to see one of the most vital elements to human survival treated as just that, rather than a mere commodity like gold, to be bought and sold with a focus on equity and profit. This does not and has never made sense, in the same way that only buying food with an eye towards someday making a profit from it does not make sense. It does make sense within our current economic system, which sadly does not make any distinction between the fundamental requirements of human life, and all other products or commodities. We all are worse off for not being able to see the difference and separate the two.
daft_pink 1y ago
I’ve found in my work with clients is that generally multi ownership in real estate means significantly lower investment returns. Generally selling a single piece of real estate that you entirely control has the highest investment returns. Things like condos are always competing with each other and coops can be even worse. Maybe it’s more affordable because it has super low investment returns.
- pcrh 1y ago
  That's precisely the point, to be honest. Treating homes as investments rather than places to live is a significant contributor to their lack of affordability, as it creates two demands for the same property. This phenomenon is not "necessary", but appears to be particularly common in the US, UK and other Anglophone countries, see this chart: https://i.imgur.com/h1CkkNE.png https://i.imgur.com/h1CkkNE.png
  - awongh 1y ago
    Yeah it's crazy that everyone in america is like, "I need a place to live" and at the same time is also like, "I get a subsidized loan to make a huge real estate investment, let me balance my decision about where to live with what I want to invest in".
  - daft_pink 1y ago
    I agree with you in a sense, but I also think when you put a lot of of encumbrances on real estate you essentially guarantee that it can only be used for that purpose almost forever until the government intervenes because you could never get the right holders to agree
mamonster 1y ago
It's all fun and games, but you need to remember that this is Canton Vaud, one of the most fiscally irresponsible cantons/states in all of Switzerland. The article briefly mentions is, but a lot of this "cooperative" housing is heavily subsidized by the canton itself (the article mentions the cheaper 99-year lease but it goes way beyond that) and the resulting shortfall in money is paid for by other people (i.e 100,000CHF yearly income in Vaud is the massive marginal tax wall in Vaud). I've still, to this day, not managed to find out any detail about how these apartments are valued for the purpose of the VD wealth taxes (You can impute house price based on comparatives or rent, here obviously rent would be lower).
- awongh 1y ago
  It also mentions that during covid there were co-ops that went bankrupt. But they don't mention what the mechanism for that was- mismanagement?
  - owenversteeg 1y ago
    I don't have any specific knowledge of Swiss co-ops, but I'd imagine it's some of the same reasons as other co-op buildings elsewhere: economic crash means residents can't pay rent or fees, improper budgeting for large future expenses that eventually come due, or poor construction or new safety requirements cause a huge expense. In Florida right now, in the wake of the Surfside disaster, a lot of condos are struggling with solvency because of the cost of the new safety requirements. Then there is always new technology (asbestos, aluminum wiring, spray foam insulation, polyurethane cladding) that will one day have to be remediated. Then there is climate change. I think the key is good management and good construction. Unfortunately, both of those things are very opaque for your average person.
- throwaway47352 1y ago
  This has nothing to do with Vaud fiscal irresponsibility. Cooperatives are all over Switzerland, very common in Zurich for instance they own 18% of the units. https://www.zb.uzh.ch/en/zuerich/Money-makes-the-world-go-round https://www.zb.uzh.ch/en/zuerich/Money-makes-the-world-go-ro...
simne 1y ago
Well, this so called "third way", as I know appear in US as private elder care infrastructure, or as charity. When somebody become so weak (ill or old), cannot care for himself and unfortunately have no family, they could ask to local private care to live in their specialized hostel. And it is not always just ordinary hostel with one room for 5 persons, but some are more like classic motels, with rooms for two persons. Also, similar infrastructure existed for a long time in Italy, under Catholics church, and I know few good young people, who grown there. As I know in Northern Europe (Sweden), there are many community buildings (under municipalities), very cheap to rent and even possible to get social donations and not pay at all. Existed also non-church homes with similar economy (and also not designed as charity), but their examples are not always good. For example, Pruitt–Igoe in St. Louis, Missouri, United States, becomes huge crime center. Other not good example, some bad districts in exUSSR (for example Biryulyovo in Moscow, or Orekhovo-Zuyevo in Moscow Oblast, Russia), also known for their criminal level. From Pruitt–Igoe experience, people created few rules about so called social homes, and one rule, they must be non-comfortable, to motivate people to grow to commercial rentals or even to once buy own home; second, should be some power, who will constantly monitor residents for crime and immediately deport offenders. So they are not "Third way", they are just temporary solution of very old problem, and not easy solution, even not cheap. https://en.wikipedia.org/wiki/Pruitt%E2%80%93Igoe https://en.wikipedia.org/wiki/Pruitt%E2%80%93Igoe
harbingerofdoom 1y ago
[dead]

Oh. Company towns.

renewiltord 1y ago
[flagged]

This should be embraced in the US as well. And we need it now, more than ever because of how the price of housing has jumped so much and will only get worse as private equity continues to hoover up housing stock.

post- 1y ago
We could also rein in private equity? Culture Study had a great episode about PE [0] recently, with some explanation of what started it and, if I remember right, some gestures towards how it might be brought to heel — or at least made less bombastically awful for most people. [0]: https://culturestudypod.substack.com/p/how-private-equity-destroys-the-companies https://culturestudypod.substack.com/p/how-private-equity-de...
- jeffbee 1y ago
  PE has nothing to do with any of it. They are totally up-front, even in their prospectuses, that the only reason they are in this game is because witless dupes (paraphrasing) in local governments are too stupid to build houses. If we would build anything, they wouldn't be in the game.
- whimsicalism 1y ago
  Private equity has lots of benefits that are never discussed because they make good bogeyman. Existing management is not always good, and I do not benefit from companies employing unnecessary workers and passing the price through to me.
  - pstuart 1y ago
    They very well may. But they are notorious for strip mining and killing viable companies, because they do.
sokoloff 1y ago
This (and other interventions) will help to the extent that they cause more housing to be built. If they will more than another change, it will durably improve housing costs. If it doesn’t make more housing, but only changes how it’s bought and financed, it’s probably just noise and distraction.
whimsicalism 1y ago
Private equity is not the cause of the housing crisis in the US and all they are doing is amortizing rental demand. Without private equity, the demand would still be there. Shocking how often this needs to be repeated.

wslh 1y ago

https://archive.is/aOjk3 https://archive.is/aOjk3

awongh 1y ago

This article is really low on actual facts about how these co-ops can actually operate. I feel like the problem in the US isn't necessarily that the government won't directly pay for these kinds of things like they do in Switzerland, but that it's very very hard to finance a co-op, possibly illegal (that is, you wouldn't have the same legal protections a condo does). I would be curious to see the finances of the buildings they mention in the article. Assuming that you could arrange the two major financial aspects: 1) financing at a level of a normal home loan 2) cut out the real estate developer profit margin, I wonder if a co-op model would become viable in the US. Edit to add: Intuitively it seems like the math could work out, if you figure that a co-op takes the appreciation of the real estate out of the picture for the people living there, and that being able to rebalance that lost value towards the initial cost or towards future costs would be a trade-off normal people would be willing to make. In that sense a co-op is more like an alternative to renting rather than an alternative to home ownership.

yupitsme123 1y ago
I think San Francisco has something like this with their Below Market Rate (BMR) housing program. You have to be below a certain income to be considered, and basically you get to pay a fixed monthly rate to "own" a place that can only be sold for a fixed amount. It always just sounded like rent to me. I think that NYC's co-ops (TICs in San Francisco) provided an interesting alternative model. They usually require owner-occupancy, can't be rented easily, and are difficult to finance. These restrictions eliminate investors and speculators, and shields the the units from the inflation that happens from fed intervention and super low rates. The result is that they're usually priced a lot lower and appreciate more slowly than they would be if they were condos.
- awongh 1y ago
  TICs are a scam though. They are just condos with less legal protections for the relationships between the tenants. They don't solve any of the cost of ownership issues or deal with the idea of appreciation of the value of the real estate. afaik it's actually much worse because you're combining the appreciation of the asset, but you can't sell as easily as with a condo.

deleted 1y ago

[deleted]

fxtentacle 1y ago

This is becoming more popular in Germany, too. In effect, future renters pool their money into a non-profit which will then build affordable housing, to be owned and inhabited by them. https://en.wikipedia.org/wiki/Housing_cooperative https://en.wikipedia.org/wiki/Housing_cooperative

mg 1y ago

his apartment ... two bedrooms, a small office, a south-facing balcony and it costs 1,760 francs (about $2,200) a month, around half the typical rents I always find it impossible to grasp/compare rents if there is no mention of the size of the apartment. For all I know, this could be a 60m² apartment with 3 smallish rooms which goes for something like half of that price in Berlin: https://www.immobilienscout24.de/expose/161188147 https://www.immobilienscout24.de/expose/161188147 Or it could be a luxurious 300m² apartment with 3 big rooms that goes for three time that price: https://www.immobilienscout24.de/expose/157476995 https://www.immobilienscout24.de/expose/157476995

andimm 1y ago
It is mentioned in an image description: > Claude Waelti’s 1,180-square-foot apartment in Lausanne costs around $2,200 a month. The rent has barely increased since he arrived in 1991. So about 110 square meters which is pretty good for number of rooms in Switzerland.
- deleted 1y ago
  [deleted]

ExxKA 1y ago

This is a big thing in Denmark and has been for several generations. https://da.m.wikipedia.org/wiki/Andelsboligforening https://da.m.wikipedia.org/wiki/Andelsboligforening The issue with them is that the loans to build the properties are socialised, so if the other members can not pay the debt, the entire loan is the responsibility of those members who can. Also, the incentives of a cheaper than market rate flat, means that corruption and nepotism is rampant in those buildings. It is not pretty in practice.

awongh 1y ago
> Also, the incentives of a cheaper than market rate flat, means that corruption and nepotism is rampant in those buildings. Maybe there's some middle ground between socialized housing that incentivizes people to take advantage of overly cheap housing, and a 100% capitalist USA style housing market where lots of people are 1 missed paycheck away from being homeless.
- FirmwareBurner 1y ago
  >Maybe there's some middle ground Maybe there is, but human history proves we can't easily reach a equilibrium where everyone has it equally good, due to human greed, envy, cronyism and corruption, making any kind of equality just a fairytale utopia. So we just bounce between extremes because as always, few people strive have it good and the rest get screwed over in order to pay for the privileges of the select few. There will always be haves and have-nots, no matter how many thumbs the government puts on the scales to try to balance things out for everyone which only breaks things for the worst as they distort economic reality. Meanwhile from the numbers I gathered, despite the "evil capitalism", statistically by most metrics, Americans enjoy the highest purchasing power for home ownership in the developed western world by a large margin. So Americans love to complain too much, but the truth is by the numbers, most of the world has it much worse than they do. 1. Demographia International Housing Affordability | Lower median multiple = higher affordability (2025 Edition) Singapore 4.2 United States 4.8 Ireland 5.1 Canada 5.4 United Kingdom 5.6 New Zealand 7.7 Australia 9.7 2. World Population Review: Housing Affordability Index | Higher index = higher purchasing power (2024 Data) United States 3.3 Denmark 2.1 Belgium 2.1 Ireland 1.8 Luxembourg 1.8 Norway 1.7 Sweden 1.7 Finland 1.7 Spain 1.7 Netherlands 1.7 Germany 1.5 Switzerland 1.5 3. Numbeo Property Prices Index | Lower ratio = higher affordability (2025 Mid-Year) United States 3.44 Germany 8.5 United Kingdom 8.71 Italy 9.04 Canada 9.45 France 9.89 Japan 11.34

Refreeze5224 1y ago

It is refreshing to see one of the most vital elements to human survival treated as just that, rather than a mere commodity like gold, to be bought and sold with a focus on equity and profit. This does not and has never made sense, in the same way that only buying food with an eye towards someday making a profit from it does not make sense. It does make sense within our current economic system, which sadly does not make any distinction between the fundamental requirements of human life, and all other products or commodities. We all are worse off for not being able to see the difference and separate the two.

daft_pink 1y ago

I’ve found in my work with clients is that generally multi ownership in real estate means significantly lower investment returns. Generally selling a single piece of real estate that you entirely control has the highest investment returns. Things like condos are always competing with each other and coops can be even worse. Maybe it’s more affordable because it has super low investment returns.

pcrh 1y ago
That's precisely the point, to be honest. Treating homes as investments rather than places to live is a significant contributor to their lack of affordability, as it creates two demands for the same property. This phenomenon is not "necessary", but appears to be particularly common in the US, UK and other Anglophone countries, see this chart: https://i.imgur.com/h1CkkNE.png https://i.imgur.com/h1CkkNE.png
- awongh 1y ago
  Yeah it's crazy that everyone in america is like, "I need a place to live" and at the same time is also like, "I get a subsidized loan to make a huge real estate investment, let me balance my decision about where to live with what I want to invest in".
- daft_pink 1y ago
  I agree with you in a sense, but I also think when you put a lot of of encumbrances on real estate you essentially guarantee that it can only be used for that purpose almost forever until the government intervenes because you could never get the right holders to agree

mamonster 1y ago

It's all fun and games, but you need to remember that this is Canton Vaud, one of the most fiscally irresponsible cantons/states in all of Switzerland. The article briefly mentions is, but a lot of this "cooperative" housing is heavily subsidized by the canton itself (the article mentions the cheaper 99-year lease but it goes way beyond that) and the resulting shortfall in money is paid for by other people (i.e 100,000CHF yearly income in Vaud is the massive marginal tax wall in Vaud). I've still, to this day, not managed to find out any detail about how these apartments are valued for the purpose of the VD wealth taxes (You can impute house price based on comparatives or rent, here obviously rent would be lower).

awongh 1y ago
It also mentions that during covid there were co-ops that went bankrupt. But they don't mention what the mechanism for that was- mismanagement?
- owenversteeg 1y ago
  I don't have any specific knowledge of Swiss co-ops, but I'd imagine it's some of the same reasons as other co-op buildings elsewhere: economic crash means residents can't pay rent or fees, improper budgeting for large future expenses that eventually come due, or poor construction or new safety requirements cause a huge expense. In Florida right now, in the wake of the Surfside disaster, a lot of condos are struggling with solvency because of the cost of the new safety requirements. Then there is always new technology (asbestos, aluminum wiring, spray foam insulation, polyurethane cladding) that will one day have to be remediated. Then there is climate change. I think the key is good management and good construction. Unfortunately, both of those things are very opaque for your average person.
throwaway47352 1y ago
This has nothing to do with Vaud fiscal irresponsibility. Cooperatives are all over Switzerland, very common in Zurich for instance they own 18% of the units. https://www.zb.uzh.ch/en/zuerich/Money-makes-the-world-go-round https://www.zb.uzh.ch/en/zuerich/Money-makes-the-world-go-ro...

simne 1y ago

Well, this so called "third way", as I know appear in US as private elder care infrastructure, or as charity. When somebody become so weak (ill or old), cannot care for himself and unfortunately have no family, they could ask to local private care to live in their specialized hostel. And it is not always just ordinary hostel with one room for 5 persons, but some are more like classic motels, with rooms for two persons. Also, similar infrastructure existed for a long time in Italy, under Catholics church, and I know few good young people, who grown there. As I know in Northern Europe (Sweden), there are many community buildings (under municipalities), very cheap to rent and even possible to get social donations and not pay at all. Existed also non-church homes with similar economy (and also not designed as charity), but their examples are not always good. For example, Pruitt–Igoe in St. Louis, Missouri, United States, becomes huge crime center. Other not good example, some bad districts in exUSSR (for example Biryulyovo in Moscow, or Orekhovo-Zuyevo in Moscow Oblast, Russia), also known for their criminal level. From Pruitt–Igoe experience, people created few rules about so called social homes, and one rule, they must be non-comfortable, to motivate people to grow to commercial rentals or even to once buy own home; second, should be some power, who will constantly monitor residents for crime and immediately deport offenders. So they are not "Third way", they are just temporary solution of very old problem, and not easy solution, even not cheap. https://en.wikipedia.org/wiki/Pruitt%E2%80%93Igoe https://en.wikipedia.org/wiki/Pruitt%E2%80%93Igoe

harbingerofdoom 1y ago

[dead]