A housing cooperative is a non-profit business entity formed by cooperative members who join together to build and acquire a home under the best possible conditions of quality and price.
How does a housing cooperative work?
To understand how a housing cooperative works, from its foundation to the management of the properties, it is necessary to know the following steps:
- The non-profit society is created under the Cooperatives Law and the statutes of the cooperative are established.
- The members make the initial capital contribution destined for the constitution expenses and the development of the project.
- The investment in the purchase of the land is carried out and the construction proceeds.
- Once the homes are built, they are allocated to the members according to the criteria of the statutes.
- The members must pay for the home at the price obtained, without having to assume additional costs for intermediaries.
- The cooperative is also usually responsible for the management and maintenance of the homes.
It must be taken into account that cooperative members are participatory and intervene in each and every one of the important decisions that affect their future homes.
The most relevant decisions in the process correspond to 4 main phases: localization and reservation of the land, formalization of the deed, execution of the works, and delivery of keys.
Advantages of belonging to a housing cooperative
More and more people are interested in knowing what a housing cooperative is because of the advantages it represents. The fact that it allows for lowering costs by dispensing with intermediaries is the greatest attraction it offers. For example, in an operation of this type, a real estate developer does not participate, and the associated costs are saved.
However, this is not the only benefit of cooperatives. Also interesting is the fact that cooperative members enjoy greater participation in the construction project and in decision-making.
Furthermore, future tenants have conditions similar to those of any other real estate transaction (amount contributed by the buyers, financing guaranteed by banks, and quality controls at the site).
Process of creating a housing cooperative
The creation of a housing cooperative follows this process:
- The negative name certificate is requested from the central register of cooperatives or the corresponding autonomous community register.
- The constituent assembly is held and the statutes are approved.
- The public deed of constitution is granted before a notary, with a certificate of deposit in the banking entity for each of the members.
- The provisional CIF (tax identification number) is requested, through the Tax Agency or a notary's office.
- The Stamp Duty on documented legal acts is settled.
- Registration is carried out in the register of cooperatives.
Frequently asked questions about housing cooperatives
What are the requirements to be part of a housing cooperative?
Housing cooperatives are regulated in Spain by Law 27/1999 and their Social Statutes, in which the rights and obligations of the members are determined.
In addition to following what is specified in this law, a housing cooperative must also follow the stipulated creation steps, with the corresponding documentation and necessary payments.
At an administrative level, it must meet these requirements:
- Have the negative name certificate.
- Have approved statutes and constitute an assembly.
- Formalize the public deed of the constitution.
- Have a provisional CIF.
- Register in the register of cooperatives.
And at an economic level, it must assume these costs:
- Notary fees for the constitution.
- Initial capital deposit for the project.
- Payment of the agreed amount for the purchase of each home.
Can I sell my participation in the cooperative?
Generally, in a housing cooperative, the sale of the participation to a person outside of it is not allowed. But it is indeed possible to transfer it to another member of the cooperative.
This regulation must be present in the statutes of the housing cooperative that have been previously approved.
In those cooperatives where the sale of the participation is allowed, a right of first refusal is usually included, which consists of giving priority to the members to buy said participation if it interests them.