Zamikhaya Gladwell Gotyi
Wilson Majee
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- 1Department of Public Administration and Economics, Mangosuthu University of Technology, Durban, South Africa
- 2Department of Health Sciences, University of Missouri, Columbia, MO, United States
Background: The urban housing crisis in South Africa’s metropolitan inner cities has escalated into a significant socio-economic and public health concern. This complex issue, driven by a combination of factors, calls for innovative and inclusive solutions. Housing cooperatives offer a promising approach to addressing this challenge. Therefore, it is essential to explore the potential of housing cooperatives as a viable, community-centered alternative for housing provision.
Objective: The primary aim of this paper is to examine the transformative potential of housing cooperatives in addressing the urban housing crisis. Additionally, it seeks to explore how housing cooperatives can enhance socio-economic inclusivity and empower communities in urban environments.
Methods: Two primary electronic databases, Sabinet and Science Direct, were searched for relevant articles using a combination of key terms related to cooperatives (e.g., housing cooperative, policy, history, developing world, sustainability, community empowerment, social capital, and South Africa). Google Scholar was also utilized to supplement the database searches, and bibliographies of selected articles were reviewed for additional relevant sources. Data from the identified articles were abstracted, analyzed, and used to explore the critical role of cooperatives as a sustainable solution for addressing the housing crisis and promoting social cohesion in South Africa’s metropolitan areas.
Results: A total of 211 records were identified, with 85 ultimately included in the review. The literature indicates that housing cooperatives have the potential to drive social change, foster community resilience, and support equitable urban development. They can be utilized not only to expand access to affordable housing but also to promote social cohesion, community empowerment, and socio-economic development in South Africa. When implemented sustainably, housing cooperatives can help alleviate housing shortages while strengthening community empowerment and social cohesion.
Conclusion: Policymakers and those in positions of power to allocate resources in urban housing development should consider housing cooperatives as a viable solution to the challenges faced by South African metropolitan cities.
1 Introduction
South Africa’s major cities are facing significant housing shortages, exacerbated by ongoing urbanization. Over the past three decades, the government has explored various strategies to address the crisis, yet the demand for housing continues to surpass the supply. Urban areas remain attractive to people from rural regions and neighboring countries seeking better opportunities (Adigeh and Abebe, 2024). There is an urgent need for innovative and inclusive approaches that promote community empowerment while addressing the critical shortage of affordable housing. One promising solution is housing cooperatives. A cooperative is a group of individuals who share a common economic, social, or cultural need that they believe can be addressed by creating and running a joint, democratically owned business enterprise, funded by their investments and retained earnings, and distributing benefits to its members based on their contributions. This model brings together people from lower social and economic backgrounds to collaboratively identify their challenges and develop solutions (Huron, 2015). Housing cooperatives not only provide an alternative model for meeting immediate housing needs, but they also foster community empowerment and social cohesion (Del Rio, 2022). By offering affordable and sustainable housing solutions, cooperatives can enhance a sense of community ownership and participation (Sanchez-Bajo, 2022), while ensuring democratic control and management by tenants (Heath, 2022). In many countries, cooperatives have proven to be an effective way to provide housing for middle- and low-income earners (Adegun and Olusoga, 2019; Oyalowo, 2020).
Much has been written about cooperatives across various disciplines, yet discipline-specific systematic reviews within the cooperative movement remain limited. In response, we conducted a systematic review focusing on housing cooperatives to explore their historical context, structural and operational mechanisms, and their transformative potential in addressing urban housing scarcity while promoting community empowerment and socio-economic inclusivity. Systematic reviews can significantly enhance the understanding of a topic by clarifying what is known and what remains unknown (Owens, 2021). They often provide deeper insights than a single study and can inform critical decisions, such as resource allocation (Uttley et al., 2023). This approach enabled us to comprehensively accumulate articles that focused on the transformative nature of cooperatives.
2 Methods
In conducting our systematic review, we searched both the Sabinet and Science Direct databases using key terms such as housing cooperative, history, policy, developing world, sustainability, community empowerment, social capital, and South Africa. To supplement the data collected from these databases, we also utilized Google Scholar and manually reviewed the bibliographies of identified articles. Only primary research studies published in English were included. In total, 211 records were identified, with 85 meeting the criteria for inclusion in the review (Figure 1).
Figure 1
Figure 1. Housing cooperatives in South Africa - PRISMA flow chart.
3 Findings
3.1 History of housing cooperatives in South Africa
Although cooperatives in South Africa date back to 1831, originating as white-owned and government-funded agricultural societies (Van Niekerk, 1988; Vink, 2012), housing cooperatives only emerged around 1996. At this time, the Gauteng government facilitated homeownership for 2,000 tenants from seven apartment buildings in Hillbrow, Joubert Park, and Berea (Jimoh and Van Wyk, 2014). These tenants were granted exclusive rights to use the facilities and participated democratically in managing their affairs (Sanchez-Bajo, 2022). This shift allowed tenants to transition from being mere consumers to active participants in the management and decision-making processes (Girbérs-Peco et al., 2020). Despite this initiative, the government has yet to recognize cooperatives as effective tools for housing development. The support provided to cooperatives remains inadequate, minimal, unfocused, and poorly coordinated [Republic of South Africa (RSA), 2023]. Consequently, the private sector is also hesitant to view housing cooperatives as a viable model for human settlements (Mushonga et al., 2019). Due to this lack of support, housing cooperatives have experienced limited development and growth. Nevertheless, they still hold significant potential to address the housing crisis. Sustainable solutions to housing challenges in developing countries require the adoption of a framework for viable, integrated, and self-managed communities (Van Wyk and Jimoh, 2015).
3.2 Benefits of housing cooperatives
Housing cooperatives offer more than just affordable housing; they also promote social capital, improve housing quality and stability, facilitate skills acquisition, and contribute to socio-economic development (Bianchi, 2022).
3.2.1 Housing affordability
Housing affordability plays a key role in achieving the United Nations Sustainable Development Goals (SDGs) and supporting a healthy, productive labor force vital for a country’s economic growth (Azeez and Mogaji-Allison, 2017). Housing cooperatives offer affordable housing solutions for low- and middle-income earners (Shaker, 2019) while promoting community participation and democratic governance (Huron, 2015). They enhance members’ living conditions by improving safety and satisfaction, while ensuring enterprise profitability through lower operating and management costs (Brzeska and Jedrzojewski, 2021). Housing development is a complex and capital-intensive process, making it unaffordable for many low- and middle-income individuals (Adeoye, 2018). Cooperatives simplify this process, reduce costs and inequalities, and promote the equitable distribution of housing development benefits (Wanyama, 2014). By pooling resources, members enhance their bargaining power and achieve economies of scale and scope, which lowers development costs. Housing cooperatives also provide an alternative to traditional homeownership by offering reduced upfront costs and lower monthly expenses (Birchall, 2004).
3.2.2 Social capital
Housing cooperatives encourage participatory planning and a bottom-up culture of collective action (Lang and Novy, 2014). They enhance community bonds, foster neighborliness, and create a stronger sense of home and safety (Crabtree-Hayes, 2024). By cultivating a sense of collective responsibility, cooperatives establish a social environment where residents actively engage in housing governance (Balme and Gerber, 2018). Members are more proactive in addressing antisocial behavior, promoting community unity, and building social capital (White, 2021). Additionally, housing cooperatives drive social change by fostering equality among citizens and encouraging participation in activities that influence their daily lives (King et al., 2013). They provide residents with better access to social networks, increased social support, and stronger social cohesion (Crabtree-Hayes, 2024).
3.2.3 Community empowerment and participation
Cooperatives bring together organized groups of low- and middle-income homeowners who can actively engage in community affairs (Huron, 2015). Members share collective ownership and participate in democratic decision-making processes for managing and operating their housing, fostering community empowerment (Sanchez-Bajo, 2022). Housing cooperatives exemplify the transformative potential of collective action by empowering communities, narrowing socio-economic gaps, and strengthening the resilience of inner cities in the quest for a more equitable and inclusive urban future (Hsiao, 2020). Residents actively participating in the management and operations of their facility are more inclined to invest in maintaining and improving their living spaces, thereby enhancing the overall well-being of their community (Chirisa et al., 2014). Cooperatives are structurally designed to ensure that all members are treated the same, resources and goods are distributed equally, and every member has direct access to the benefits of their collective efforts (Ajates, 2020). Housing cooperatives promote dialogic leadership by encouraging every member to take on leadership roles, ensuring power is distributed evenly to maintain the cooperative’s sustainability (Girbérs-Peco et al., 2020). Through active participation in the cooperative’s governance, members develop participatory democracy skills that prove beneficial in other aspects of life (Huron, 2015). This involvement equips members with valuable knowledge, boosting their confidence in their abilities and the collective’s potential (Girbérs-Peco et al., 2020). Additionally, housing cooperatives foster self-confidence, enhance self-esteem, and instil a strong sense of belief among members (Coates et al., 2015).
3.2.4 Sustainable development and environmental impact
Housing cooperatives play a significant role in promoting sustainable development and reducing the environmental impact of urban housing (Yimam et al., 2022). They frequently adopt eco-friendly practices such as energy-efficient designs, waste reduction measures, and community gardens (Cabré and Andrés, 2018). By emphasizing environmental sustainability, housing cooperatives contribute to building resilient and environmentally conscious urban communities (King et al., 2013). Their organizational capacity for training, education, and communication positions cooperatives as key participants in the global movement for sustainable development (Wanyama, 2014). By involving residents in property management, housing cooperatives further enhance the sustainability of housing initiatives, aligning their structure and operations with the principles and goals of sustainable development (Brzeska and Jedrzojewski, 2021).
3.3 Challenges facing housing cooperatives
Factors such as legal complexities, financing difficulties, and limited public awareness about the model often hinder the sustainability of housing cooperatives (Barenstein et al., 2022).
3.3.1 Legal complexities
The sustainability of cooperatives depends on state support, particularly legislative and policy frameworks to access land and finance (Sanjines et al., 2022). However, government regulations and planning laws are often biased toward conventional housing solutions (Crabtree et al., 2021). This restraint threatens the development of housing cooperatives and burden their sustainability.
3.3.2 Inadequate finance
The state’s lack of interest in cooperatives has led to financial institutions’ hesitance to offer support (King et al., 2013). This has not only hindered their growth but also debilitated existing cooperatives. It is crucial for the state to take an active role in providing housing, particularly by subsidizing citizens who are unable to finance their own homes (Ajayi, 2022). In countries such as Australia, Canada, Norway, Sweden, Switzerland, and Turkey, housing cooperatives flourished due to extensive support from various societal institutions, including the government, labor unions, mutual and commercial banks, and community organizations (Sørvoll and Bengtsson, 2018).
3.3.3 Poor capacity
A lack of public awareness about the cooperative model is the primary barrier to the success of cooperatives (Rena, 2017). Many individuals join cooperatives without understanding how these organizations operate. Cooperatives are frequently established by people who were previously strangers but must now collaborate to ensure the enterprise runs smoothly (Heath, 2022). Often, these individuals lack training in leadership and management, which negatively impacts the cooperative’s administration (Jimoh and Van Wyk, 2014).
4 Discussion
With rapid urbanization, South Africa is under increasing pressure to provide affordable housing. After exploring various strategies to address the housing deficit without success, the government could consider cooperatives as an alternative approach to tackle the crisis. The country’s housing backlog exceeds 2 million units, with high demand from low- to middle-income households [Centre for Affordable Housing Finance Africa (CAHFA), 2024]. Housing cooperatives seem to be a viable, community-led, and scalable solution to help reduce this deficit (Charlton and Kihato, 2006). They offer a sustainable option for meeting the housing needs of a growing urban population while addressing issues related to informal settlements (Turok, 2012). Existing legislative frameworks support the adoption of cooperatives in housing provision. For instance, South Africa’s Constitution guarantees every citizen the right to adequate housing, urging the state to explore innovative solutions like cooperatives [Republic of South Africa (RSA), 1996]. Additionally, the Cooperatives Act provides a strong legal foundation for the establishment and management of cooperatives [Republic of South Africa (RSA), 2005], facilitating their formalization, governance, and access to resources [Republic of South Africa (RSA), 2005]. Furthermore, housing cooperatives align with the principles of the Breaking New Ground (BNG) policy, which promotes integrated, sustainable, and community-driven development [Republic of South Africa (RSA), 2004]. As noted by Turok, housing cooperatives present South Africa with an opportunity to integrate low-income residents into well-located urban areas, addressing the spatial inequalities created by apartheid-era planning (Totaforti, 2021). In doing so, housing cooperatives contribute to sustainable urban planning and land use by encouraging higher-density and mixed-use developments (Czischke et al., 2025).
On a global scale, cooperative housing aligns with both the United Nations SDG 11 and the African Union’s Agenda 2063, which focus on inclusive and sustainable development. Cooperatives have long been an effective tool for providing affordable housing, not only in low-income countries but also in middle- and high-income nations. Uruguay, for example, has shown how government-supported cooperative housing initiatives can sustainably address housing shortages (Encinales et al., 2024). Organizations such as Rooftops Canada and UN-Habitat have expressed interest in supporting housing cooperatives in South Africa, offering technical expertise and financial assistance (Ngwenya, 2018).
While housing cooperatives have the potential to succeed in South Africa, several factors may hinder their growth. The cooperative housing model is not well understood, and public awareness of its benefits is limited (Gotyi et al., 2021). Many cooperatives are established and run without members receiving training in the cooperative business model (Kanyane and Ilorah, 2015). The absence of such foundational skills can lead to unresolved conflicts among members and undermine the sustainability of the cooperatives (Ngwenya, 2018). Additionally, apartheid-era policies in South Africa resulted in racially segregated urban areas and deepened spatial inequality. A significant portion of the population was excluded from homeownership and relocated to underdeveloped peri-urban areas, which contributed to the housing backlog (Totaforti, 2021). Approximately 12.2% of South Africans live in informal settlements (Statistics South Africa, 2023), and the insecurity of tenure, along with the lack of basic infrastructure, presents further challenges for establishing housing cooperatives. With about 55.5% of the population living below the national poverty line and an unemployment rate of 32.1% in Q3 of 2024, raising cooperative financing is difficult (Statistics South Africa, 2024). Housing cooperatives require access to affordable, long-term financing, but many South Africans are heavily indebted, with household debt at 40.7% of disposable income in 2024, making it hard for them to make collective financial contributions [South African Reserve Bank (SARB), 2024]. Financial institutions in South Africa are also hesitant to finance cooperatives, favoring individual home loans instead. Even government housing subsidies are typically directed toward individual ownership, not collective initiatives (Qumbisa et al., 2025). No specific funding is allocated to housing cooperatives, despite the capital-intensive nature of housing development.
Additionally, no policy framework clearly defines the role of cooperatives in housing development. While cooperatives are briefly referenced in national policy frameworks, no specific legislation or policy has been established for housing cooperatives. As a result, housing cooperatives are governed by general cooperative laws and policies. Current housing policies place greater emphasis on large-scale state-subsidized housing delivery rather than alternative housing models (Tomlinson, 2015). Bureaucratic obstacles in setting up housing cooperatives, especially in the land acquisition process, pose significant challenges (Jimoh and Van Wyk, 2014). Cooperatives often face the difficulty of navigating complex land acquisition procedures and municipal approval systems (Charlton and Kihato, 2006). The lack of recognition and adequate support has limited the ability of cooperatives to effectively contribute to housing delivery. Consequently, only a few housing cooperatives are actively involved in housing development in South Africa (Jimoh and Van Wyk, 2014). Examples include the Ikhayalethu Housing Cooperative in Johannesburg, which has played a role in revitalizing the inner city by converting abandoned buildings into housing for low-income earners (Tissington, 2010). The Ekhaya Housing Cooperative in Cape Town has provided housing for low- and middle-income earners while addressing spatial inequalities and integrating low-income residents into urban areas (Charlton and Kihato, 2006). Cosmo City in Johannesburg has successfully integrated low, middle, and high-income earners, promoted social integration, and reduced spatial segregation. According to Turok (2012), this project highlights the potential of cooperatives in large-scale developments. These examples offer valuable lessons for the government. With the urban population rapidly increasing, there is a growing need for alternative housing solutions. It is time for housing cooperatives to be recognized as a viable model for addressing the challenges of a growing urban population (Van Wyk and Jimoh, 2015).
5 Conclusion
This paper offers valuable insights in leveraging housing cooperatives as a catalyst for social change, community resilience, and equitable urban development. As urbanization accelerates, exacerbating the housing crisis, the housing cooperative model presents a potential strategy to reduce the housing deficit. Research indicates that this model would not only facilitate the provision of affordable housing for low- and middle-income citizens, who struggle to secure mortgage loans from commercial financial institutions, but it would also help reduce crime, strengthen social cohesion, and foster socio-economic development in inner-city areas.
Data availability statement
The original contributions presented in the study are included in the article/supplementary material, further inquiries can be directed to the corresponding author.
Author contributions
ZG: Conceptualization, Investigation, Methodology, Project administration, Writing – original draft, Writing – review & editing. WM: Writing – review & editing.
Funding
The author(s) declare that no financial support was received for the research and/or publication of this article.
Conflict of interest
The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.
Generative AI statement
The authors declare that no Generative AI was used in the creation of this manuscript.
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Keywords: housing cooperatives, housing shortage, community empowerment, social cohesion, inner cities, South Africa
Citation: Gotyi ZG and Majee W (2025) Empowering communities: the role of housing cooperatives in alleviating urban housing crisis. Front. Sustain. Cities. 7:1519100. doi: 10.3389/frsc.2025.1519100
Edited by:
Frank Eckardt, Bauhaus-Universität Weimar, GermanyReviewed by:
Maria Tsvere, Chinhoyi University of Technology, ZimbabweMarcelo Hamilton Sbarra, Federal University of Rio de Janeiro, Brazil
Copyright © 2025 Gotyi and Majee. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) and the copyright owner(s) are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.
*Correspondence: Zamikhaya Gladwell Gotyi, Z290eWkuemFtaWtoYXlhQG11dC5hYy56YQ==