On 1 March 2023, the Act of 4 November 2022 on housing co-operatives (Journal of Laws 2023 item 28) (hereinafter: the ‘Housing Co-operatives Act’ or the ‘Act’) entered into force.
The essence of a housing co-operative is the joint implementation of a housing project by the individuals involved, in particular through the acquisition of a registered plot of land and the foundation of a detached house or a multi-family building with residential premises on it. The legislature’s ratio for the introduction of the above-described formula is to streamline and assist citizens in carrying out housing investments on their own.
The basic assumptions and assets of a housing co-operative:
(i) the parties involved are natural persons – min. 3 persons,
(ii) the parties conclude a housing co-operative contract or a civil partnership contract (Article 5 of the Act),
(iii) the purpose of the housing co-operative is to meet the housing needs of the parties and not to make a profit resulting from any trading of real estate (Article 4 of the Act),
(iv) the so-called housing development consists of the following elements: joint acquisition of real estate and carrying out the investment and construction process.
(v) the minimisation of the cost of carrying out the housing investment by 20% compared to the development market,
(vi) joint incurring of costs and implementation of the housing project with joint expenses,
(vii) greater influence on the shape, functionality and aesthetics of the detached house or residential premises compared with the development market,
(viii) in the case of a housing co-operative, the parties also have greater decision making power over such elements as neighbourhood selection, the investment and construction process (including renovation), and negotiations with a bank on a housing loan for the project
(ix) discount on the price of property acquired from the municipality under the housing co-operative formula.
*The legal liability of the parties involved in a housing co-opeartive is joint and several,
**The new Development Act does not apply in the case of a housing co-operative,
***The Act also introduced changes to the ‘Housing without contribution’ programme
