Housing cooperatives are widespread throughout Uruguay, extending from the capital, Montevideo to small towns throughout the country. The key drivers behind this development have been the principles of cooperation, active participation, direct democracy, and the presence of a supportive legal framework and public financing.
As at 2022, Uruguay’s housing deficit is between 50,000 and 60,000 housing units. The Ministry of Housing and Land Use Planning is responsible for the corresponding policies. The country’s total permanent housing stock is slightly over 1.1 million, while the total population is less than 3.5 million.
In the past five decades, despite having a powerful law, the situation has not substantially improved. There are over six hundred irregular settlements where more than fifty thousand families, totaling around two hundred thousand people, live. These settlements suffer from legal insecurity, physical deficiencies, and lack basic services.
The state implemented various programs to address this issue, which are now consolidated under the Directorate of Social and Urban Integration. These programs include Neighborhood Improvement, relocations, and a mitigation program known as “Plan Juntos” (Plan Together).
The Cooperative Model
The cooperative model is the most efficient at providing low-cost urban housing through self-management and individual contributions. This can either be in the form of mutual aid cooperatives, where members contribute work, or pre-savings cooperatives, where members contribute money. In addition, by collectively owning the housing complexes and granting the right of use and enjoyment to its members, cooperatives prevent speculation in the social housing market.
Malecón Mauá cooperative on the Montevideo Promenade in the Sur neighbourhood housing 46 families.
Legal Framework
Since 1968, Uruguay has had a national housing law that legally recognizes the cooperative system and establishes financing mechanisms. These mechanisms provide access to housing for all sectors through subsidies that consider the income and family composition of the groups involved.
Although there is a relevant legal frame of reference, housing investment remains low. Social housing pays taxes, while private investment is exempt, causing a cost increase of 12 to 20%. Additionally, loans are offered at market interest rates instead of social interest rates, forcing them to consume a significant portion of public housing resources through subsidies.
For the cooperative movement to succeed, it requires support from the state in the form of legal status and public financing, including loans and subsidies to facilitate housing payments.
Dictatorship Years
During the dictatorship from 1973 to 1985, the cooperative and housing movements were practically outlawed. Leaders and activists were persecuted, loans and legal status was suspended, and there were attempts to eliminate collective ownership. However, with the resurgence of democracy, the housing cooperative movement has been growing and consolidating. Today, it is recognized as the most efficient tool for providing access to decent housing for the popular sectors.
Federations
Despite the challenges mentioned earlier, the country has more than seven hundred housing cooperatives organized into two main federations: FUCVAM, focused on mutual aid, and FECOVI, which emphasizes previous savings. These cooperatives bring together around thirty thousand families and over one hundred thousand individuals. Considering the size of the country and the historical lack of support for cooperatives, these numbers demonstrate the impact of the housing cooperative movement, making it an important social player.
CUDECOOP represents more than 3,500 grassroots cooperatives from all sectors active in the country, involving more than one million cooperative members.
The Uruguayan Federation of Mutual Aid Cooperatives (FUCVAM) is a trade organization established in 1970. Its mission is to strengthen the right to housing by uniting cooperatives under the principles of mutual aid and collective property. The founders and workers of FUCVAM recognized the cooperative model as a solution to housing challenges in lower-income sectors.
Mutual Aid Model
Mutual aid is a defining feature of Uruguay’s cooperative housing model. What began as a means of contributing labor and financial support to construction has evolved into a deeper social process. Future members actively participate in the design and planning of their housing, fostering a strong sense of ownership, collaboration, and community identity. This participatory approach not only strengthens collective decision-making but also promotes social cohesion, shared responsibility, and an alternative, community-driven model of urban development.
The Cooperative Housing Movement for Mutual Aid originated within Uruguay’s working class as a response to the severe housing crisis. Its goal was not only to provide shelter but to build neighborhoods that offer residents a dignified and decent quality of life. From its inception, housing cooperatives were deeply intertwined with the Uruguayan Trade Union Movement, adopting a strategic, class-based framework. This approach enabled cooperativism to address a broad spectrum of needs through a unified class perspective, rather than catering to isolated sectors of society.
Beginning in the early 2000s, the Uruguayan Federation of Mutual Aid Housing Cooperatives (FUCVAM) expanded its reach through partnerships with international allies. It began working to adapt and transfer its proven cooperative housing model to Central American countries, including Guatemala, Honduras, El Salvador, Nicaragua, and Costa Rica.
In 2004, this effort gained momentum with the launch of We Effect’s Regional Housing and Habitat Program in Latin America. The program’s mission was to facilitate the transfer and replication of the Uruguayan model across the region. Since then, cooperative housing in Mesoamerica has made substantial strides, demonstrating the viability and adaptability of mutual aid-based housing as a powerful tool for social development and urban inclusion.
Members of Castalia Housing Cooperative in Montevideo, Uruguay
FECOVI: National Federation of Prior Savings Housing Cooperatives
The origins of Uruguay’s housing cooperative movement date back to 1966, with the founding of the first cooperatives based on three pilot initiatives launched by the Uruguayan Cooperative Centre (CCU) in various towns. In 1968, Uruguay’s Parliament enacted the National Housing Law, which laid the legal foundation for the country’s social housing programs. This law institutionalized the cooperative housing system, recognizing two management modalities—mutual aid and prior savings—and two forms of ownership: user cooperatives and owner cooperatives.
By 1969, cooperatives operating under the prior savings model united to form the National Federation of Housing Cooperatives (FENACOVI). The federation was established to promote the savings-based cooperative model as a viable solution to the housing needs of the working class.
However, the emergence of the military dictatorship in 1973 significantly disrupted cooperative development. In 1976, a government decree abolished the prior savings cooperative system, and FENACOVI was shut down. Despite the suppression, many cooperatives remained active and resilient, serving as grassroots spaces of democratic resistance throughout the regime.
With the return of democracy, FENACOVI was formally reinstated in 1984, immediately confronting unjust and illegal interest rate hikes on housing loans imposed during the dictatorship. Since then, the federation—now known as FECOVI—has played a key role in rebuilding and expanding the cooperative housing sector.
Today, FECOVI represents around 105 prior savings housing cooperatives across Uruguay, including both completed and in-progress projects as well as groups in the early stages of formation. Altogether, these cooperatives represent more than 5,000 families.
FECOVI continues to be a central actor in Uruguay’s cooperative housing ecosystem, advocating for housing as a social right and supporting cooperative efforts grounded in solidarity, participation, and self-management.
Watch the video below about Castalia Housing Cooperative in Montevideo.
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