Malta’s first housing cooperative plans a new form of home ownership

The Malta Cooperative Federation (MCF) is preparing to open the island’s first housing cooperative to provide affordable housing that prioritises well-being over profit.

“Our vision goes beyond bricks and mortar; it’s also about building a community,” said Claudio Farrugia, CEO of MCF.

Under this model, rather than buying an apartment in the traditional sense, people would purchase a share in the co-op. This would entitle them to occupy a unit and participate as a co-owner.

The resale value of a member’s share would be proportional to inflation rather than to the Residential Property Price Index, meaning that homes would remain affordable for future gene­rations, Farrugia explained.

With skyrocketing rent prices and many struggling to buy homes, Farrugia expects that cooperatives, whether buy-in or rental, will ease financial hardships and reshape the way people think about property in the future.

“This approach shifts the focus from investing in pro­perty as a speculative asset to investing in one’s wellbeing and a dignified way of living,” he said.

Farrugia estimates that prices for a typical apartment would be around 30 per cent lower than current market levels, reducing the need for hefty bank loans.

The centrally located housing cooperative will also prioritise inter-generational living, with families, young people and older adults living in community.

This model represents a counter-reaction to the tendency of uprooting the elderly from their communities and placing them in care homes, Farrugia said.

While each co-op member would have their own private living space, they could assist one another in daily life.

“The idea is to create a microcosm of society, where people of different ages and backgrounds live together and support one another,” Farrugia said.

For example, retirees with extra time on their hands could assist working parents with childcare or cooking; likewise, younger residents could keep their older neighbours company and assist them with their daily needs.

While the cooperative is not a form of social housing, it will dedicate some apartments to social housing and allocate some residences for people with disabilities, Farrugia said.

Co-op residents would share recreational spaces and a common area to hold community meetings.

Decisions about management, maintenance and the direction of the co-op are to be made democratically, based on the cooperative principle of one member, one vote.

Housing cooperatives have seen great success around the world. London’s award-winning Coin Street model has served as a source of inspiration for the MCF vision.

Rather than only benefitting members, cooperative living is meant to serve the wider community. MCF hopes to make amenities such as green spaces, gyms and parking lots accessible to the community at large.

The MCF is still making arrangements to officially institute the housing co-op, but Farrugia estimates that the first members will be able to move in within the next three years.

He emphasised that government support will be critical to get the programme on its feet before it can fully sustain itself.

The co-op plans to take a variety of factors into consideration to ensure housing equity – co-op shareholders cannot own other properties, and people exceeding the co-op’s income cap would not be eligible for membership.

Applicants would be invited for an interview to make sure they are suited to live in a community-oriented space.

Cooperative housing projects are also environmentally sensitive, focusing on water conservation and green energy.

“We aim for developments with minimal environmental impact,” Farrugia said.

He acknowledged that cooperative housing breaks with Malta’s norms of home ownership. Nonetheless, Farrugia anticipates this model will fill an important niche in the housing market for those wanting to prioritise well-being over monetary returns.