About Italy
History
Italian cooperatives have a long history dating back to the mid-19th century. The first cooperative was founded in 1854, and shortly after, in 1886, a national association called Legacoop was established. In 1919, a split within Legacoop led to the creation of another national association known as Confcooperative Habitat. Cooperatives in Italy, as in other European countries, were established to address immediate needs such as unemployment and high living costs, based on the principle of solidarity.
The first housing cooperative in Italy was established in 1884 by the workers of a tobacco factory in Bologna, which is located in the region of Emilia Romagna, known for its cooperative successes. From the late 1800s to the 1920s, several thousand housing cooperative units were developed, supported by political leaders who saw the cooperative ideology aligned with their political and ideological beliefs.
Many cooperatives, including housing cooperatives, were destroyed during the World Wars, and the Fascist regime brought an end to self-help democratically run housing cooperatives.
After the Second World War, there was a revival of the Italian cooperative movement, with legislative changes to facilitate cooperative development. The new Italian constitution, drawn up in 1947, explicitly recognized cooperation as a form of mutual aid. A general law on cooperatives, known as the “Basevi” Law, was adopted in 1947 to regulate cooperative affairs, recognizing the implementation of indivisible reserves, which allowed cooperatives to transfer all of their surpluses to a reserve. In 1992, the adoption of Law number 59 provided the cooperative movement with another major financial development mechanism through the creation of a ‘Solidarity Fund’.
From the 1970s onwards, cooperatives, including housing cooperatives, experienced growth. However, there was a difficult period between 1980 and 1985, followed by a housing development boom in the 1990s until mid-2007. Since then, there has been a slowdown in construction, marking the end of the booming period.
In the late 1990s, there was a significant change in Italian housing policy, as housing became a regional jurisdiction. This has led to the regional governments defining development priorities and allocating finances towards housing, while the federal government has a more limited role in policy development and building standards approval, statistics collection, and information sharing.
Context
The majority of housing in Italy is owner-occupied, with only 18% being rental housing, a quarter of which is social housing. The cooperative housing movement has enjoyed positive legislative measures including tax exemptions and the ability to form consortia to meet housing cooperatives’ needs, be shareholders in joint-stock companies, and control them. However, Italy is facing a severe housing crisis due to economic hardships, increasing unemployment, and limited mortgage lending, making it difficult for people to access homeownership.
The demand for housing has shifted due to demographic changes, such as the high proportion of elderly people and the challenge of immigration. There is also a growing demand for rental housing from groups such as university students, atypical workers, and young couples, who often face precarious employment situations and mobility within the country.
The reduction of public housing and the decentralization of housing provision to the regions has led to large regional discrepancies. Scarce financial resources are targeted to the neediest people, and the reduction of federal government involvement and the liberalization of the market have contributed to the housing crisis. Recent surveys show that approximately 1 million social housing units need to be built to meet demand.
Housing cooperatives are actively addressing this crisis by modifying their development strategy to include affordable rental properties in the form of social housing cooperatives. They are also promoting good quality rental and ownership projects with a focus on urban and building sustainability. Italian housing cooperatives have shown leadership in sustainable development and are engaged in various initiatives and projects to promote energy efficiency and the use of renewable energy sources in the sector.
For example, organizations like Legacoop Abitanti and Federabitazione have been involved in European projects such as POWER HOUSE EUROPE, eSESH, LIFE – ECO Courts, SHE – Sustainable Housing Europe, IRH-MED, and ICE WISH, aiming to promote sustainable housing practices and energy efficiency in social housing.
Description
There are two types of housing cooperatives: conventional housing cooperatives and social housing cooperatives.
Key characteristics for both types are:
- Cooperatives are developed according to a system of approval managed by regional governments, and agreements are concluded at the local level.
- Cooperatives are created by a building cooperative.
- Membership in housing co-ops is open to everyone wishing to live in a co-op housing unit. Membership is not restricted to those who live in a co-op unit.
- Each person interested in having a co-op housing unit buys a share of about $200. This share gives the person the right to vote, to be put on a waiting list, and to be informed when units are becoming available.
- People on the waiting list receive an application form when a project or a unit becomes available.
- Membership is approved, and the unit is allocated according to the date of application as long as the person meets the eligibility criteria.
- All housing co-ops must contribute 3% of their net surplus to a national development fund.
- Housing cooperatives must transfer 30% of their surplus, to a maximum of 70%, to an indivisible reserve. These amounts are tax-free. Upon dissolution of the cooperative, the reserve must be transferred to the cooperative development fund and cannot be given to an individual member.
- Management is done through the sector organizations and employees. Volunteer management is very limited.
- Conventional housing cooperatives – owner-occupied:
- Units belong to the individual members.
- Units are sold to individual members at slightly below market value to take into consideration the special government subsidies. Some equity restriction is imposed at resale for at least 20 years.
- Social housing co-ops – rental:
- Projects are targeted at people with special needs, such as the elderly, disabled, and people on low incomes.
- Ownership remains in the hands of the cooperative to ensure long-term affordability.
- Individual members rent their units.
- Building design takes into consideration the needs of the target group (accessibility, security).
- Projects obtain below-market funds in the form of direct financing from regional governments (very limited).
Financing
In the wake of the financial crisis, consumer confidence has been affected by the recession and high unemployment, leading to a decrease in demand. Accessing credit from banks, especially for household loans, has become difficult, resulting in a reduced capacity for housing co-ops to invest in the housing market.
Before 1998, federal government provided financial assistance to housing cooperatives in the form of interest subsidies on loans and making suitable land available for cooperative development. Currently, regional authorities offer financial support through capital contributions (for low-income groups) and reduced interest loans, amounting to 10% to 40% of the total project costs.
Cooperative housing financial tools include member shares, member loans, tax exemptions, capital from indivisible reserves, and mutual funds that were established in 1992. These funds pool 3% of cooperative surpluses to finance sector development programs or promote new cooperatives, but do not directly finance building programs. There are currently 4 national funds in addition to the Ministry of Economic Development Fund.
The 2008 Housing Plan laid the foundation for the establishment of an integrated system of real estate funds at the national and local level. These funds aim to finance residential buildings and social housing. The target beneficiaries are households that do not qualify for public social housing but are unable to secure adequate housing at market conditions.
The funds gather resources from public and private stakeholders, including Cassa Depositi e Prestiti (a public financial institution) and banking foundations. Currently, 11 projects promoted by these funds have been launched, with an expected output of about 6,000 dwellings.
Legal Framework
The legal instruments for the co-op housing sector are:
- Article 45 of the Constitution
- Decree Law of December 14, 1947, nr 1577 – “Basevi” Law which regulates co-operatives in the Republic of Italy
- Law of February 17, 1971, nr 127 – new provisions for cooperatives, an updating of the Basevi Law
- Law of November 8, 1991, nr 381 – regulation of the social co-operatives
- Law of January 31, 1992, nr 59 – new regulations for co-op firms (financial aspects – co-operative shareholder members with multiple votes and mandatory allocation of 3% of annual surplus in solidarity fund)
- Law of August 2, 2002, nr 20 – revision of the legislation on co-operatives
- Decree Law of January 17, 2003, nr 6, article 8 – regulations of joint stock corporations and co-operative firms
- Civil Code 2003, ITEM VI – articles 2511 – 2548
- The following specific sector laws: single text n. 1165 of 1938, Law n.167 of 1962, Law n. 865 of 1971, Law n.457 of 1978 and, Law n. 179 of 1992.
The Cooperative Housing Movement
The cooperative housing sector in Italy consists of four national organizations: AGCI-Abitazione (a member of the AGCI federation), FEDERABITAZIONE (a member of the CONFCooperative federation), Legacoop Abitanti (a member of LEGACOOP), and UNCI. UNCI, which stands for the Union of Italian Cooperatives, is a cross-sector cooperative federation, but its role in the housing sector is minimal.
The three main federations, AGCI, Confcooperative, and Legacoop, have formed an alliance called Alleanza Cooperativa Italiana (ACI) with the goal of promoting a stronger role for cooperation in creating a more fair and sustainable market and society. This alliance is an important step in reasserting the autonomy of the cooperative movement and its fundamental principles and practices.
AGCI – Abitazione, also known as Associazione Generale delle Cooperative Italiane (The General Association of Italian Cooperatives), was established in 1952. It is the sectoral organization that brings together all housing cooperatives and consortia that are members of Associazione Generale Cooperative Italiane (AGCI). The association is responsible for representing member cooperatives, promoting cooperation in the housing sector, and supporting the professionalization of housing cooperatives.
AGCI Abitazione represents 633 active cooperatives with 41,110 individual members. Currently, out of a total of 90,000 dwellings allocated, approximately 70% are for ownership and 30% for rental. In recent years, housing cooperatives that are members of AGCI Abitazione have focused on providing rental dwellings and redeveloping the existing housing stock.
For more information, visit: www.agci.it (Italian only)
FEDERABITAZIONE – Federazione Nazionale delle Cooperative Edilize di Abitazione / National Federation of Housing Cooperatives
Established in 1954, Federabitazione provides advice, protection, and representation to housing cooperatives and consortia. It promotes activities aimed at increasing and rehabilitating the housing stock while considering the needs of local communities. The organization also supports the entrepreneurial development of cooperatives and consortia, implements training programs for members, staff, CEOs of cooperatives, and partner organizations, and promotes activities to increase solidarity and exchange between regional federations to foster the development of housing cooperatives across all Italian regions. Federabitazione also provides regular information to its members about technical, legal, and economic developments in the sector.
Additionally, Federabitazione has established two national consortia: Consorzio Nazionale CasaQualita’ (aimed at quality certification of housing cooperatives), and Consorzio Nazionale Conit-Casa.
FEDERABITAZIONE currently has 2,408 member cooperatives, out of which 2,294 are active, along with 102 consortia and 12 enterprises with another legal status as of June 2011. Together, they have built a total of 258,700 units (the majority being owner units), with 158,800 individual members.
For more information, visit: www.federabitazione.confcooperative.it (Italian only)
Legacoop Abitanti – Associazione Nazionale Cooperative di Abitanti / National Association of Housing Cooperatives
Established in 1961 as Ancab, Legacoop Abitanti is a union dedicated to representing and safeguarding the interests of social cooperatives, their consortiums, and members. It works to coordinate their activities and promote the cooperative movement in the housing sector. The cooperatives within Legacoop Abitanti are involved in various housing initiatives such as new construction, rehabilitation, and offering additional services to residents. They focus on providing housing for elderly people, students, young couples, and immigrants. Furthermore, they prioritize quality and sustainability in urban areas and housing projects, and are involved in several bio-architecture projects.
Legacoop Abitanti boasts a membership of 1,861 housing cooperatives, which have collectively constructed 322,000 property units, and have 417,200 individual members. This membership includes 52,000 rental units and 270,000 owner units.
For more information, visit: www.legacoopabitanti.it (Italian only)
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