Big moments of crises call for bold ideas!
The housing crisis across our European continent keeps on getting worse, especially in cities. Everyday, more people struggle to find or finance an affordable and suitable place to live. This is affecting citizens, companies and our society alike. One of the great promises of the EU - being able to live and work in different places and even countries during our life - turns out to be more a theory than an actual opportunity for a growing majority.
As the worsening climate crisis is calling us to rethink how we build, live, and travel more sustainably anyway - it actually seems to be the right moment to tackle the housing crisis in a new, bold and European way.
Dear Europeans, let’s team-up!
We live on a continent where we collectively have a great amount of financial resources available. We have countless existing buildings that could be revitalised or repurposed.
Across Europe, there are thousands of innovative companies that can and want to contribute to a green transition of the built environment. There is also a rapidly growing number of companies which have started to explore how they can help their (future) employees find affordable housing. Yet, the biggest opportunity for change is coming from the individual: There are presumably millions of citizens who are longing for a change of their housing situation in this very moment.
Now, the EU allows us to collaborate across borders like no other place on earth. So we started to imagine:
- What could we create if we get a lot of motivated citizens and purpose aligned companies across Europe to team up, tackling the housing crisis together?
- What could we achieve if we pool our minds, hearts and pockets - forming one pan-european cooperative organisation?
- What could happen if we manage to build a scalable, non-speculative housing system that would benefit all participating citizens and companies, but also the cities and our European Society as a whole?
The most impactful European housing company in 2050 could be… ours!
Right now, the most influential housing companies on a European scale are corporates that treat and trade homes as an asset class. We’d like to imagine a different future:
Let’s co-create a European Housing Coop that will enable 1+ million (future) humans by 2050 to collaboratively own and use living spaces all across the EU - fostering a beautiful life, in community and within our planetary boundaries.
Before we dive into how this European Housing Coop could come alive and what it would actually do - let’s first unpack the current housing crisis in a bit more detail:
The problems around housing in the EU
The current housing market in the EU / Europe is in many ways not sustainable. Neither for humans, nor for the planet. Looking at the three common dimensions of sustainability, here are some facts:
- Buildings and the construction industry are the world’s biggest consumer of raw materials - and in the EU, buildings are responsible for 36% of greenhouse gas emissions
- For many decades, the real estate industry has practiced a way of tearing down buildings that were supposedly not suitable anymore, replacing them in resource consuming ways with again not future-proof ones in terms of energy efficiency, usage flexibility and material recyclability (~75% of our building stock is currently energy inefficient)
- While the majority of actors in the real estate industry have now “woken up” to the reality of climate change (82% of a 2022 survey consider ESG elements in their operational & investment decisions), the big transition to a circular & climate net zero approach is still ahead of us
- We increasingly take up more living space per person - across the EU, the amount of sqm per capita has more than doubled since 1960 - in Germany e.g. it has gone up from 19sqm to 47sqm in 2022
- At the same time, it’s estimated that 1 of 6 properties in Europe are vacant – equal to around 38 million empty homes
- Access to affordable and adequate housing is considered a human right. However, in the EU, housing has become unaffordable for many people, with over 80 million affected. Out of the ~450 million EU citizens, 1 out of 10 people spend more than 40% of their income on housing (>30% is commonly understood as being unaffordable). In some countries like Italy, that ratio is 3 out of 10.
- Financialisation of housing as an asset class, speculation on rising land values, increasing commerce with short-term rentals (#airbnb), and lack of creation or sale of affordable housing stock have all contributed to an accelerated housing crisis across the EU, particularly in cities.
- House prices have gone up by an average of 47% between 2010-2022 in the EU. In combination with the recent rise in interest rates, buying a house or apartment is becoming a less viable option for many.
- Humans generally have a longing for both, community and privacy - but most existing housing & apartments are not well designed and structured to cater to both. 35% of residents across the EU report a frequent feeling of loneliness in life (loneliness and weak social connections are associated with a reduction in lifespan similar to that caused by smoking 15 cigarettes a day)
- At the same time, solitary living arrangements are on an all-time high, about 40% across the EU live alone
- We can witness an increasing segregation in the EU, between generations & cultures, social & financial backgrounds, political perspectives, renters & owners, urban life and the countryside. Most new building projects in the housing sector don’t aim at building bridges in our society. Rather, they often accelerate a divide in our society.
- We need to adapt how we (re)build and live more in tune with our planetary boundaries
- We need a lot more long term affordable housing solutions across Europe
- We need to create more approaches to housing that foster community and fight segregation
Now: who is going to fix this?!
In the middle of our current housing crisis, the role of publicly owned housing becomes more important than ever. But given the limitation of resources and the often slow bureaucratic processes, (most) cities can’t fix the housing crisis on their own.
What about the private real estate sector? Many companies have paused their development activities in the housing sphere because they can’t generate the financial profits they seek under the current market conditions. The available public subsidies to foster social housing are often perceived as not sufficient / suitable or to limiting. Other corporate players continue to build, but focusing on creating and selling high end / luxury housing. Well, that’s certainly not helping to tackle the housing crisis, either. In the bigger cities, even a large portion of the “middle class” can’t afford to buy their own apartments anymore - if one didn’t inherit a decent chunk of money.
Now, there is another, often-call third model in the housing sphere that has been around for decades, in some places even for over a century:
Housing cooperatives!
Many Housing Coops willing to scale face similar challenges:
- Lack of access to affordable real estate assets with a development potential
- Lack of access to affordable capital to realise developments & refurbishments (especially with the recent increase of interest rates on the financial markets and rising building costs in 2022/23)
- Limited resources / capacity to explore & leverage digital solutions / new technologies / organisational approaches to enhance efficiency, streamline processes, decrease the carbon footprint and lower costs
- Unlike large corporate housing developers or public housing organisations with 10.000+ flats, most housing cooperatives don’t have a lot of buying power to negotiate “good deals” with suppliers in a competitive market environment
- Existing coop members must also support new developments (…and that support is difficult to gain if new developments imply rising costs for existing members - without adding individual benefits)
Our approach
The European Housing Coop (EHC) aims to become the first community driven and technology powered company that accelerates the creation of sustainable, cooperative housing on a European scope.
We bring purpose aligned asset owners, companies, impact investors, local housing coops, and hopefully a whole lot of citizens into a new mode of collaboration - forming one pan-european cooperative company together. This will enable us to initiate the development of a growing number of spaces across the EU, each will feature affordable, climate-friendly and community-oriented housing. For ecological reasons, we’ll focus on repurposing / revitalising existing spaces.
This is how we’re currently envisioning the model:
The EHC becomes and remains a co-owner in each local project, but the development is always led by a local, experienced partner - ideally an existing cooperative. Through that model, all EHC members (whether they are individuals or organisations) partially own a stake in every EHC project. This allows us to build a network of spaces that we really collaboratively own together.
As we scale our mission to more cities, the EHC becomes more valuable and useful with every project that we give birth to. We bring a new level of mobility and interconnectedness to the cooperative housing world. Our members can move between places, cities and countries - they can stay as guests in beautifully furnished apartments for just a few months, or as long term residents for potentially a lifetime.
What will the EHC do, more concretely?
- Access to affordable real estate assets and capital for the development / refurbishment are two of the biggest bottlenecks for housing cooperatives when they want to extend their impact.
- We believe that with active campaigning on a European level, a bold vision, and our unique business approach, we will be able to unlock real estate opportunities and impact capital that have previously been inaccessible to local housing coops.
- We still need to explore how we best set up & structure the pooling of financial resources that allows us to allocate them towards the development of new housing projects under the EHC umbrella, also from a risk management & governance perspective. We might have to create a separate evergreen European impact fund for sustainable housing projects to finance the development of the local projects. The fund would not be focused on high financial yields, but on maximising social & ecological dividends. A strong imperative here is to measure the ESG dimensions accordingly.
- Even though we’re focused on a societal & environmental mission, that doesn’t mean we’re against markets and capitalism per se. We want to actively include a variety of companies (that share our mission to foster sustainable living and tackle the housing crisis in Europe) into our cooperative business model.
- These companies can be e.g. EU based tech start-ups, service providers or larger pan-european manufacturers. They can come from the fields of planning, construction, interior design, smart home, energy, climate tech, shared mobility, etc.
- The mission here is three-folded:
- 1) we want to source discounts / good deals with them for our members & projects
- 2) bring them onboard as EHC company members, contributing annual membership fees
- 3) in return, strengthen their publicity, bring them to new markets and expand their impact & profits
- We have a high degree of flexibility when it comes to sourcing real estate assets with a development potential for the EHC and our local partners
- Our clear focus lies on revitalising / repurposing / extending existing buildings, due to ecological reasons. But we’re potentially also open to assets which will involve new buildings as long as they can be realised in a circular & sustainable approach.
- There are, however, some characteristics that all projects should fulfil:
- Creation of living spaces for at least 30 people, bridging different cultures and generations
- Different types of apartments & living arrangements (e.g. large cluster flats, enabling co-living opportunities)
- 15-25% furnished apartments for temporary stays
- Various kinds of shared spaces & amenities (like guest rooms, co-working areas, rooftop gardens, urban farming, creative studios) to offer a high quality of living, strengthen the local community - all while lowering the individual sqm footprint
- Shared green mobility solutions - (e)bikes / (e)scooters / electric cars
- Mixed use spaces, especially on the ground floor (cafe / co-working / space for cultural & educational events, local retail) - depending on the building structure and the needs / offerings in the surrounding area
- Our overall goal is to initiate all projects in collaboration with local housing cooperatives - letting them take over the role as developer and space operator, bringing in their local experiences, expertise and existing relationships with the local community and the planning authorities.
- While the EHC will centrally source interested & suitable long term residents, the local housing coop will be responsible to curate a diverse community, with the goal to involve the residents in the space design and operation in the best manner possible.
- More details about the envisioned interplay between the EHC x Local coops x Residents can be found here.
- All local housing cooperatives that work with us will also become members of the EHC.
- Looking ahead, we might also work with housing cooperatives from neighbouring regions, impact driven private local developers or local public housing organisations if we can source a promising real estate asset, but have no suitable local housing coop partner in proximity.
One of EHC’s core tasks is strategic community building: we need to identify, attract, onboard and retain various stakeholder groups. The goal is that they not only participate, but develop an identity as a co-owner of the EHC. Ultimately, we want everyone to benefit as our cooperative company grows and reaches new territories.
Here is an overview of what the different stakeholders shall contribute & receive:
👇 Stakeholder groups | What they could contribute… | What they could receive… |
Asset owners (individuals / companies) | - land/buildings with (re)development potential | - reasonable price or leasehold fees
- societal recognition & publicity |
Impact Investors | - capital to finance local real estate developments | - reasonable interest rates
- high social & environmental ROI |
Existing local housing coops | - lead the development process for local new projects
- serve as operating entity, handling relationships with residents | - access to affordable assets & capital to realise new projects
- technological solutions, access to knowledge & discounted offerings from partners to drive up efficiency |
Companies | - discounted products / offerings (b2c to individual members or b2b to local housing coops)
- membership fees | - visibility & publicity
- ability to let (future) employees become EHC members, helping them with affordable housing
- get to offer services / products to the EHC community, highlighting whey they’re part of the mission
- access to new markets & clients
- opportunity to host events in EHC spaces |
Citizens (Individual members) | - financial resources through membership fees & coop shares
- knowledge & hands-on support, depending on personal skills & interests | - access to affordable and sustainable housing (for temporary stays and long-term residence)
- access to discounted services & product offerings from membership companies |
In the future, municipalities might also play a bigger role. In addition to private asset owners, they can contribute publicly owned assets with development potential to the EHC, demonstrating their municipality’s support for European collaboration & non speculative housing.
The digital platform that we’ll develop over time serves multiple purposes & stakeholders:
- It allows everyone to discover existing housing cooperatives & other actors that are willing to tackle the housing crisis across the EU on a map (e.g. companies, impact investors, banks, asset providers, creative bureacrats).
- All individuals who want to join our mission and gain access to sustainable long term housing (or who want to join “just” for potential temporary stays whilst supporting our joint endeavour) can signal interest / at a later stage directly join as a member - and provide context & data what they’re looking for.
- The platform offers a streamlined process for the application, curation & onboarding of long term residents for new local projects - making it easy for individuals and the local housing coops alike.
- We’ll also integrate a central booking platform that allows all members to explore options for temporary stays across all projects, managing the booking process & payment. EHC company members can also explore projects that offer suitable spaces for events and book them directly through the platform.
- We’ll integrate our growing
EHC’s Open Knowledge Center into the platform, which we will continuously expand with insights & experiences that we gain from developing the EHC - and we’ll encourage and support our various members to document their experiences and perspectives. - As we go along, we’ll explore together with the cooperative community what further technological infrastructure can / should be developed or integrated that will drive up efficiency, lower costs & time and increase user / member satisfaction.
- As we have set out to develop more sustainable housing across the EU, it’s vital that we also measure our activities and impact accordingly with a suitable ESG framework.
- We want to support our local partners in gathering relevant data - also providing them with benchmarks and insights from other spaces. 👉 This all serves to collaboratively maximise our positive impact.
Where are we at in the process?
Oh, at a very early stage 🙂 It’s a big mission, and it’s gonna be a longer journey. But as they say: “If you can imagine it, you can build it”. During 2024, we want to set the seeds for the first three projects in different cities across Europe. And we want to form the European cooperative with citizens and companies from several different countries. The entire organisation will run as a decentralised remote-coop, making it easy for anyone who wants to collaborate, independent where you’re currently based.
Got Interested?
Yay! Stay tuned through our newsletter and let us know if you want to become an early-stage collaborator. Also reach out if you’re having any other questions.
EHC’s Open Knowledge CenterContactJoin the mission!