In Australia, we can have Affordable Housing for all who want it by using Affordable Housing Funding Cooperatives (AHFC). We know we can achieve affordability because we can eliminate most of the financial overhead imposed by the financial sector. The cost savings go to home buyers and investors. An AHFC uses the existing rules, regulations and procedures of debt based financing but does not create traditional debt.
Affordable Home Funding Co-operatives consist of between 10 and 300 homes . Each Co-op sets its own goals. For example:
A family living in a dwelling funded by the Co-op has security of tenure.
A family needs zero deposit to purchase a home.
No family need pay more than 30% of their disposable income to live in the home they occupy.
Part of the money paid for living in the home goes to acquiring equity in the home.
A family must pay a minimum of 1% per year of the value of their home.
Investors must receive a rate of return of 7% adjusted for inflation.
Families living in houses funded by the Co-op get the first option to invest in the Co-op up to the value of the home in which they live.
The Co-op covers insurance.
The titles to dwellings can be with the occupier, the Co-op, or with another Co-op.
Dwellings can vary in type and need not be physically located in the same area.
Dwellings must have an energy rating of 8 stars.
Families can move between Co-operatives and preserve their equity.
Home Funding Co-ops coordinate their finances and other goals using a process similar to Pre Power Co-ops.