Cohousing and public benefit
What benefit to the public does cohousing have, can you protect such benefits in the long term and why does it matter?
We were delighted to be invited to a virtual cohousing ‘café’ in December 2022 by the UK Cohousing Network, to discuss the issue of cohousing and public benefit. This article summarises the main threads of discussion from the event.
What benefit to the public does cohousing have?
In our experience, residents of cohousing schemes can recite a long list of benefits which cohousing has for its own members, from offering an antidote to loneliness and social isolation, to providing a mutual support network and an intentional community of people with similar values.
However, what wider community benefits does cohousing have? Some examples might be as follows:
- Environment: most cohousing communities share resources (lawnmowers, laundry facilities, etc) and so use fewer resources, compared to mainstream ways of life. Many are explicitly aligned to environmental goals, with car clubs, food growing, bicycle storage, renewable energy generation, carbon reduction strategies and biodiversity uplift goals being integral to how they operate. Devolving control over the design of housing to its residents, instead of leaving it with mainstream developers, also has the inevitable result that housing is better insulated and more airtight, resulting in greater energy efficiency and positive environmental benefits, which have a knock-on effect on the wider community.
- Social: where cohousing groups engage with the wider community in which they are located, they can help to reduce social isolation and improve community cohesion, as well as offering physical space and facilities which the general public can use. For example, my own cohousing group has regular ‘work days’, where local people join our members to plant trees, maintain hedgerows and do other useful jobs to help with our stewardship of the land. It offers a forum for the wider community to come together with a common purpose, helping us connect both with each other and with the land we live on. Other cohousing groups offer their common house to the general public as a social/meeting space.
- Health and reduced pressure on resources: many cohousing groups operate car sharing schemes, reducing vehicle use and local levels of pollution, with resulting benefits for physical health. We’re also aware of examples where cohousing residents have been able to remain at home instead of going into hospital or other care facilities, because of the mutual support network offered by cohousing, reducing pressure on local health and care services.
- Affordability: where a cohousing project delivers affordable housing, it can help to reduce poverty and financial hardship in a local area, by providing lower cost housing for local people.
Why does it matter?
‘Public benefit’ is a term which is more often found in the charitable sector. Cohousing projects don’t usually qualify as charitable, because of the amount of private benefit which individuals (being members of the project) derive from cohousing (primarily through living there).
However, the concept of public benefit is still relevant to many cohousing groups, not least because the most-frequently used description of community-led housing refers to the benefits of the scheme being ‘clearly defined and legally protected in perpetuity’. For cohousing groups who want to access public funding, it can be important to understand and articulate exactly what public benefit the scheme will have, especially where this definition is being referred to.
Being able to articulate the public benefit which arises from a particular cohousing scheme can also help to generate support from third parties, including planning authorities. Of course, more generally it may also feed into a cohousing group’s values and aims to provide a beneficial development, in perpetuity.
Can you protect cohousing public benefit in the long term?
If public benefit is important to your cohousing group, can it be enshrined and protected in the long term? There are several ways to do this, although none are fool-proof and we would recommend a multi-faceted approach.
- Legal structure: most cohousing groups in the UK are set up as limited companies (usually but not always limited by guarantee) or co-operative societies. You could ensure public benefit in the long term by using a dual structure, where a community land trust or similar owns a site and leases it to the cohousing group. Yorspace is an example of this. You couldalso consider using a community interest company. Although there are drawbacks to this structure and we would not usually recommend it for cohousing, we are aware of a couple which have used this structure successfully (e.g. the Threshold Centre).
- Constitution: you could include provisions in your constitution to ensure that your cohousing scheme has wider public benefit in the long term. For example, you could entrench provisions in your governing document which prevent any surplus profits being distributed among members, unless 100% of members vote in favour of changing this (this might be referred to as a ‘voluntary asset lock’). You could also attempt to safeguard such provisions by using a ‘custodian member’ or a ‘golden share’ i.e. an external body whose consent must be sought before the governing document is changed.
- Planning system or covenants on the leasehold/freehold title: you may be able to negotiate a planning obligation which ensures a site is used for cohousing in perpetuity, or include this kind of obligation as a covenant on the property title. However, such obligations and covenants are always open to challenge.
Ultimately, a cohousing group could be established and governed without any reference to wider public benefit. However, for many cohousing groups, benefitting the wider public reflects their vision and values more generally and in some cases it opens up access to public funding or support. It can be a useful exercise to articulate the public benefit which your own group has, and consider how it may be legally protected in the long term.
If you would like to discuss any aspect of this article further, please contact Laura Moss or any other member of the community-led housing team on 0113 244 6100.
The information in this article is necessarily of a general nature. The law stated is correct at the date (stated above) this article was first posted to our website. Specific advice should be sought for specific situations. If you have any queries or need any legal advice please feel free to contact Wrigleys Solicitors.