Urbanities,
Vol. 4
·
No 1
·
May 2014
© 2014
Urbanities
7
Antonia. Residents gave me several possible reasons for this: force of habit; the second President
is younger, in her thirties and is not seen as a mother figure (despite having a daughter); Miss
Ruby is African-American, while Antonia is the sole Latina resident. A third Board was recently
elected—the new President is a white male, so this change in gender and race presumably will
affect the social dynamics.
Miss Ruby knows that she is older and not in the best of health, so she is consciously
grooming a new generation of leaders, teaching them the skills of managing a co-op. She is the
self-appointed ‘internal monitor’ of the co-op and takes seriously the idea of keeping it as
affordable housing.
Most residents express happiness and pride to be owners instead of renters, stating that they
feel more secure on a personal level (always having a place to live), and that if they stay long
enough they will eventually make some money. Only a few see it as stepping-stone to owning
another home and most plan on staying indefinitely. The background of residents varies
ethnically as well as in terms of previous home-owning experience. In particular, many from the
Caribbean are not first-time homeowners, having owned a place in Barbados or Trinidad, but
people born in the US are more likely to have grown up in either public housing or rental
apartments. The exceptions are mostly Southerners, some of whom grew up in houses their
parents owned, but they are first-time homeownership themselves.
Asset Accumulation and Affordability
A major policy issue arises from the tension between the two values of wealth creation for
homeowners and balancing the long-term affordability of housing stock. LECs offer a potential
for both. Government assistance takes many forms, but with LECs, subsidy retention is the main
mechanism. This financial assistance does not subsidize the buyer but rather the place in order to
ensure long-term, even permanent affordability. Homeowners still earn equity, just not as much
as they would under a private ownership model, but are also exposed to less risk, as we see with
the many underwater mortgages and foreclosures. One advantage of subsidy retention is that this
one-time subsidy is not just for a few ‘lottery winners’ but stays within the community, so new
funding is not necessary for each subsequent owner. In this manner, LECs can preserve low-
income and mixed-income housing in gentrifying neighbourhoods (Jacobus and Lubell 2007).
LECs also may act as a potential buffer against the effects of the housing crisis and
recession. For example, at Home Together, in the summer of 2010, one owner lost her job and
another could not work for several months due to illness. Instead of losing their apartments as
they might have in a rental situation, these shareholders negotiated with the Board of Directors
and worked out payment schedules.
While LECs protect the building shareholders, whether this process protects the block and
community from gentrification or crime is unclear. Transforming into a co-op allowed Home
Together’s residents to get rid of the criminals living in and working out of their building,
changing the dynamic of the entire building, but their particular block still is full of gang
