For the last year and a half, Chase Hasegawa and a few of his neighbors at the Courtyards at Waipouli have been trying to preserve their Kaua‘i apartment complex as a much-needed source of workforce housing. The tenants have been working with a Honolulu nonprofit with the hope of buying the property and turning it into an affordable housing cooperative.
If their Waipouli Housing Cooperative is successfully established, it would be the first affordable housing cooperative to be created on Kaua‘i and the first in decades for the state.
Cities and states across the continent are looking at housing co-ops to help combat gentrification and prevent residents from being displaced. According to Housing Cooperative International, the housing co-op movement believes this model can meet the homeownership needs of Americans at 80% to 120% of the area median income without ongoing subsidy. In 2020, the University of Hawai‘i at Mānoa’s Department of Urban and Regional Planning published a research report that said housing cooperatives “could and should be promoted more by state and civil society organizations in Hawai‘i,” given that the right support exists.
In a co-op, a corporation—sometimes in the form of a nonprofit—owns the building or complex. Residents buy shares in the corporation, and these shares grant them the right to occupy a unit. This means that the property’s mortgage is the responsibility of the co-op, which makes it easier for those who can’t qualify for individual mortgages to become homeowners.
Co-op shares can be sold at market rates or at prices determined by a formula that maintains affordability for the long term. Co-ops operate on an at-cost basis, meaning monthly charges paid by each unit only rise with increases in operating costs.
Drastic rent spikes are less likely to occur under the co-op model because it removes profit from the equation, says Fred Gibbs, president of the National Association of Housing Cooperatives, which has 1,125 co-op members representing 144,453 units.