Uruguay has 2,197 housing cooperatives. In a country of 3.4 million people, they house roughly 5 percent of all households. The land and the flats are owned collectively and are permanently removed from the private market. As housing costs climb across the world, that arrangement is drawing fresh attention.
UN-Habitat puts the global housing shortage at 288 million homes. Researchers writing in The Conversation count more than 1.8 billion people without adequate, affordable housing. "The Uruguayan case is iconic. It has been and continues to be an inspiration," says Elkin Velásquez, the UN agency's regional director for Latin America and the Caribbean. He describes cooperatives as part of a "tool kit of solutions".
The model was built during a crisis. In the 1960s, with the country in economic turmoil, a group of architects proposed cooperatively owned housing as an answer to the deficit. The first pilot projects were financed by a mix of government funds, loans from the Inter-American Development Bank and members' own contributions. They proved cheaper, faster and better in quality than conventional housing. That record carried the National Housing Law of 1968, which gave cooperatives a legal framework.
Two ways in, one rule
Two models dominate. In savings cooperatives, members pool roughly 15 percent of the capital themselves, which unlocks a state-subsidised mortgage for construction. Members buy "social shares" equal to the cost of their unit. The shares are reimbursed if they leave, and can be inherited.
Mutual aid cooperatives are designed for households with no savings at all. Instead of money, members contribute 21 hours of work per week on the building site. Tasks are assigned by ability and range from manual labour to ordering materials.
The rule both models share is the important one: land and homes stay in collective ownership and never return to the private market. Members pay a monthly fee that repays the state loan and covers maintenance. In exchange they hold an unlimited, inheritable contract of use and enjoyment. Anyone leaving is partly reimbursed, with the cooperative typically retaining 10 percent.
Roughly half of the cooperatives, 1,008 of them, are in Montevideo. They range from 12 homes to 700 flats. Two federations hold the system together: FUCVAM represents more than 35,000 households in 730 mutual aid cooperatives, FECOVI around 5,000 households in the savings model. Technical Assistance Institutes advise cooperatives on the building itself. These independent nonprofits are recognised in the 1968 law.
Teresita Palomeque joined one in the 1970s with colleagues from the bank where she worked. Construction took four years. She moved into a three-bedroom flat in a development of redbrick towers on a main Montevideo avenue in 1975, and lives there still, among a thousand other cooperative residents.
The model does not travel automatically. El Salvador and Colombia have struggled to fit cooperatives into existing housing policy, largely for want of political and institutional backing. Where that backing exists, the share can be large: in Zurich, cooperatives account for almost a fifth of the housing stock.