Isthmus | Affordable Ownership
New group wants to help others form housing co-ops
BY CAMERON BREN
JUNE 14, 2018
MACHA members (left to right) Anna Castaneda, Brel Hutton-Okpalaeke, Nate Hinahara and Gabrielle Hinahara.
Gabrielle Hinahara knows that you don’t need subsidized low-interest loans or tax credits to create affordable housing.
“We did a project that is housing 12 people; the city put zero money into it, it is completely owned and managed by the people that live in it and we are giving back to the neighborhood,” Hinahara says.
Hinahara helped form Perennial Co-op on the city’s south side with a group she met while living in a Madison Community Cooperative house. They were able to make the 20 percent down payment for the building by pooling funds from 10 people. Rent at Perennial averages $400 a month and includes utilities and household supplies. House members share two living rooms, a large kitchen and two and a half bathrooms. In the basement there is storage, a workspace with tools, an entertainment room and guest room. Hinahara’s husband, Nate, says rent also includes budgeting for major maintenance projects like replacing the roof within the next four years.
Now the couple and their friends are preaching the gospel of cooperative living with a new organization, Madison Area Cooperative Housing Alliance, or MACHA.
“When we were in the midst of making Perennial we recognized early on how much we were learning,” Hinahara says. “We really want to be able share that experience with other people so they won’t have to start at square one, where we started.”
MACHA is looking to educate others about what types of co-op ownership models are possible and o guide groups through the development process.
A lot of people in Madison would benefit by living in a co-op, but they don’t know it’s an option, Hinahara says. While renovating the building they bought, many curious neighbors stopped by to ask questions.
“When we’d explain it, there were a number who said we should make more of these in the neighborhood because people are frustrated with their landlords, people are stuck in the cycle of renting,” Hinahara says.
Co-ops can be an option for people who can’t afford or don’t want traditional ownership, but also want to invest in their homes and communities, says Hinahara.
She says it’s easy to feel like the only option is to rent from a landlord or have enough money to buy a house. But, “There is a huge gap between those things…This is a model that can bridge that gap. Depending how you set up the co-op, people can be earning equity, owning the property and collectively managing it.”
Cooperative house members can also support each other through medical emergencies and other challenges. Perennial helped a housemate who didn’t have maternity leave from her employer by supporting her for a few months. “Those are the kinds of decisions you can collectively decide to support,” Hinahara says.
But creating Perennial posed a number of challenges for members as they converted a two-story, four-unit apartment house into one large housing unit. The total cost for purchase and renovations was a little more than $350,000; the property cost $205,000. The group received a loan for $232,000 and the rest was financed through loans and savings.
Even though the number of occupants didn’t change, the city required the group to get a conditional use permit. The process took about three months. “It wasn’t clear to us or city staff during our development process what codes we needed to be following, which ones applied to us,” Hinahara says.
Matt Tucker, Madison’s zoning administrator, says when the city revised its zoning code in 2012, it added language for housing co-ops. During the process, cooperative housing advocates provided testimony at nearly every meeting.
There hasn’t been a boom in cooperative housing. The only project to come forward since the zoning rewrite has been Perennial Co-op.
Brel Hutton-Okpalaeke, a member of MACHA who also works as maintenance coordinator for Madison Community Cooperative, is eager to see groups experiment with other co-op models.
“A co-op doesn’t necessarily have to be everybody sharing a kitchen and a bathroom and there’s no privacy,” says Hutton-Okpalaeke. “A co-op just means that collectively we own it and control it.”
Hutton-Okpalaeke envisions a group buying a four-flat apartment house and leaving the apartments as separate units. The group would manage the building collectively, but members would have their own units.
Nate Hinahara says he believes that model would have the broadest appeal. “I think a lot of people who aren’t in the co-op system that could really benefit from co-ops would be the type of people that are more interested in that style.”
The 10 members of MACHA are available for free consultation and assistance.
Says Hinahara: “We are just community members who want to make more co-ops of different types available.”