About Germany

Wohnbaugenossenschaft wagnis eG, Munich

Housing cooperatives in Germany play a vital role in the housing sector, especially in urban development and renewal. With a strong historical foundation, diverse models in east and west, and support from national federations, cooperatives are an essential housing option.

History of Cooperative Housing in Germany

Origins in the 19th Century

Influenced by British examples, housing cooperatives first appeared in Germany in the 19th century. The first homeownership cooperative was founded in 1862 in Hamburg, followed by the first rental housing cooperative in 1885 in Hannover. The passage of the Cooperative Act in 1889, which limited members’ liabilities, marked a turning point, enabling broader development of coop housing.

Post-War Expansion

After World War II, Germany faced a severe housing shortage. In Western Germany, 58% of the existing housing cooperative portfolio was developed between 1949 and 1970, primarily financed through the social housing system. In Eastern Germany, cooperatives took two forms: those established before WWII as not-for-profit entities, and a larger group founded after the 1953 Law of Workers’ Housing Cooperatives, heavily subsidized by the state.

Post-Reunification Adjustments

Following reunification, major state investments were directed at rehabilitating the Eastern Germany cooperative stock. However, these investments declined after 1999 as migration to the west led to high vacancy rates in the east.

Decline of State Support

In 1986, the government began pulling back from coop housing, withdrawing financial support. The non-profit law was abolished in 1990, and social housing stocks declined as earlier subsidies had to be reimbursed. A social housing reform in 2000 simplified legal structures and redirected support to households in need.

Recognition and Reform Efforts

In 2002, the Federal Government established an Expert Commission to explore housing cooperatives as a viable third option between renting and ownership. The 2004 report emphasized the importance of cooperatives and made several key recommendations:

• Recognize housing cooperatives as a critical tenure model.
• Provide financial and legal support to promote their development.
• Encourage cooperatives and their federations to improve public awareness and operational efficiency.

Current Context

Market Challenges and Modernization

Eastern Germany continues to experience outmigration and market difficulties. Nevertheless, housing cooperatives are performing better than municipal housing companies. Prefabricated housing stock has been upgraded to meet modern standards, aided by favorable loan terms from the State Bank KfW.

The share of public housing is expected to decline as privatization through unit sales continues. In this climate, the recommendations of the 2004 Expert Commission remain relevant.

Bauverein, Halle & Leuna, Halle, Germany

Characteristics of German Housing Cooperatives

• Members purchase shares, with amounts varying by coop. Upon leaving, shares are reimbursed at nominal value.
• Tenure is secure via a perpetual lease.
• Rents are regulated within legal limits.
• Some cooperatives provide social services such as kindergartens and elder care.
• Non-resident members can invest in coops but do not have voting rights. Dividends are limited to 4%.

In Western Germany, 72% of the 1,120 cooperatives have fewer than 1,000 units. In Eastern Germany, 61% of 740 cooperatives are similarly sized, though 48 manage more than 5,000 units.

Financing

Housing cooperatives no longer access social housing incentive schemes. They rely on member contributions and mortgage financing. Forty-eight cooperatives operate their own savings institutions, allowing members to invest at slightly higher interest rates than commercial banks. These funds support modernization and maintenance.

Legal Framework

• The Cooperatives Act (1889, revised 2006): Defines the organizational and operational rules of cooperatives.
• The Rent Regulation Act: Governs rent adjustments and landlord obligations.

The Cooperative Housing Movement

The Federal German Housing and Real Estate Organisation (GdW ) is the national umbrella organization representing:

• 1,850 housing cooperatives
• 750 municipal/public housing companies
• 154 private housing companies
• 55 church-owned housing companies

GdW operates through 14 regional federations, handling advocacy, legal support, technical consulting, and training.

GdW also established DESWOS (German Development Assistance Association for Social Housing) in 1969. DESWOS supports international housing development based on cooperative principles.

Allgemeine Deutsche Schiffszimmerer Genossenschaft eG, Hamburg, Dwellings in Ammersbek near Hamburg, Source: Allgemeine Deutsche Schiffszimmerer Genossenschaft eG

Presentations:

The Housing Co-operative Movement in Berlin – Renate Amann, Genossenschaftsforum [2016]

Housing Cooperatives in Germany – Prof. Dr Matthias Zabel, GdW [2024]

Resources Tagged "Germany"

Housing Co-operatives in Germany: 160 Years of Evolution and Resilience

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History Germany Research Paper

Social, affordable and co-operative housing in Europe – Case studies from Switzerland, Austria, France, Germany, the Netherlands, and Denmark

The Housing Agency of Ireland compiled 44 case studies from Switzerland, Austria, France, Germany, the Netherlands, and Denmark. The case studies respond to the various challenges of providing adequate housing.  The report includes public projects led by government or city authorities, mixed-tenure private developments, and collective schemes led by residents. Like Ireland, all the selected countries have an established tradition of providing housing that is not purely market-oriented to meet a portion of their housing need.Read More

Austria Report

How Can Housing Co-operatives Contribute to Reducing Climate Change?

This paper brings some new insights to the significant role that the housing cooperatives can play in energy-efficiency in housing, aiming to fill the existent gap in the literature in this field. Paper written for the Enhr Conference in Toulouse July 2011 by Enkeleda Kadriu and Dr Gabriele WendorfRead More

Sustainability Germany

Suggested Readings – Professor Munkner, respected European co-operative expert

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Financing and Development Germany

Profils d’un mouvement : Les coopératives d’habitation dans le monde

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Public Cooperative Housing Policies: An International Perspective

Explore public policies supporting cooperative housing worldwide in this comprehensive report. Discover how governments and cooperatives collaborate to create sustainable and affordable housing solutions globally.Read More

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Financing Co-operative and Mutual Housing

The Commission's final report on Cooperative and Mutual Housing (Bringing Democracy Home) highlighted the need for consideration of the role that cooperative and mutual housing could play in the national housing strategy. The Fina ...Read More

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Building Strong Development Cooperation: Partnership Opportunities between Cooperatives and the EU

In 2000, United Nations (UN) member states recognised the need to build global partnerships for development and the exchange of expertise as one of the Millennium Development Goals. Across the international development field, part ...Read More

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Raising Capital: The Capital Conundrum for Co-operatives

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Financing Housing Co-operatives in a Credit Crunch

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The Guidance Notes on the Co-operative Principles

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Promoting Cooperatives – International Labour Organization (ILO) Recommendation 193 on the Promotion of Cooperatives

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Profiles of a Movement: Co-operative Housing around the World – Volume One

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Students and Housing Cooperatives

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Good Governance Charter for Housing Co-operatives

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