Low interest rates have made home ownership accessible to more Canadians than ever before, but not to everyone. Those who can't afford a house or condominium right now might find housing co-operatives offer an immediate ownership solution that may lead to greater rewards down the road.

"We believe in the continuum -- that private builders are efficient at building single homes and condos, so they take care of the majority of the Canadian public who can afford to own their own home, and co-operative housing takes care of those who can not afford to own," said Christopher Wilson, Senior Public Affairs Consultant for the Co-operative Housing Federation of Canada (CHF Canada), the national umbrella organization.

"Co-operatives beautifully bridge to home ownership. Residents learn to run the co-op, acquire ownership skills, improve their social and financial situation, and get into a position that can move them to home ownership -- with confidence since they have experience managing their own housing. And all those good things happen at no cost to the public."

Co-operatives are a hybrid of rental and ownership designed for a mix of low and moderate income residents. Co-ops are distinctive because they are not owned by the government, but by those who live there as members and control their own housing through this democratically-run organization. Members participate in managing their housing, and can reduce the cost of their housing through volunteer labour. Some residents pay market rent while others, without stigma, pay housing charges geared to their income.

Co-operatives exist in three general forms:

• Building Co-operatives: The earliest co-ops appeared in Eastern Canada where citizens banded together in order to build and finance their homes. Once construction was complete, they divided the properties into separate titles with separate mortgages.

• Continuing Co-operatives: Members rent from the co-operative, but also control and own it, preserving it for future members. Non-profit co-ops are of this form, established under federal and/or provincial guidelines, built with government funding and supported with rent-geared-to-income programs.

• Equity Co-operatives: These share-based forms, where residents benefit from appreciation in value, are distinguished from condominiums as the property is held by the co-op.

In the late 1990's, the federal government downloaded social housing to the provinces, but co-operatives resisted this transfer and remained at the federal level. Through CHF Canada, co-operatives have been lobbying for self administration since 1996. This seemed a logical request since housing co-ops have proven that their administrative approach makes them approximately 14 percent less expensive to operate than municipal or private non-profit housing.

Now, the federal government has agreed to a degree of self-management that will see co-operatives in control of their own future. Canada Mortgage and Housing Corporation (CMHC) will continue administering rent-subsidy funding, but co-ops will be free to arrange mortgages and manage their finances as needed.

"It is smart of the federal government to build on co-ops' long tradition of administration," said Wilson. "This is important at this time as many co-ops are 20 years or more old and have need for refurbishment and renovation. The new agency is a way to further limit government involvement as the government is not the most efficient administrator."

The recently concluded agreement between the federal government, through CMHC, and CHF Canada allows this national federation to complete research and development activities for the successful start-up of a Co-operative Housing Programs Administration Agency by early 2006. The federal government also agreed to resolve a flaw in subsidy policy that resulted in unintended losses of assistance for low income households when co-ops in the program renewed their mortgages.

This agreement will benefit residents of 790 federally-administered co-operative housing projects -- or 35,000 units -- in Prince Edward Island, Ontario, Alberta and British Columbia. CMHC spends approximately $60 million annually for the co-operative housing it currently administers in these provinces.

CHF Canada represents 2,200 non-profit housing co-operatives, which are home to about a quarter of a million people in 90,000 households, 20 regional federations of housing co-ops, and about 120 associated businesses. This organization provides a range of services to its members, including advocacy, training and adult education, and it operates several group-buying programs for goods and services. CHF Canada can put you in touch with co-operatives in your area.