4. Legal Model

Updated: May 21

The legal model of Eco Villages Australia is ready to use for small groups of people who want to enter into collaborative housing. It would normally cost $10-20,000 to set up a structure like this, but EVA offers collaborating housing groups for a fraction of the cost.


The first question a group needs to answer when considering collaborative housing is "who owns the land". Is it the richest person, the natural leader, the most charismatic? How does a group 'own' or secure land?


Eco Villages Australia is a company limited by guarantee (CLG) operating as a true non-profit, without shareholders. Any capital gain from sale of property cannot be dispersed to members or directors.


Our legal structure is designed to put land and buildings into a what we call 'collective stewardship'.


Buy, rent or...steward?

If you want to live somewhere in Australia there are two choices. Buy or rent. We offer a third option - what we call 'stewardship'. Land ownership is hard-baked into our culture as the optimum model, however many people find that land ownership comes with huge financial drag - so much so is that only a small percentage of home owners actually get to achieve financial freedom by paying off their bank loan. People who pay off bank loans over the full 30 years or beyond often end up paying DOUBLE the principle. And when someone buys a house, the are in fact stuck. Home owners, if they are fiscally aware, don't move around unnecessarily - as you buy and sell in the same market, and when factoring in real estate fees and m moving costs, it can easily cost $40,000 to buy and sell.


Renters dream of owning, yet it's not all its cracked up to be. Renters have an advantage of not having to deal with maintenance costs (an average stand-alone house costs $3.000 per year to maintain), but they lack security of tenure. Many areas of Australia, we are experiencing a housing crisis as excess housing its being used for AirBnB or overseas workers reclaiming their rentals.


Why not have private ownership of land?

Private ownership of community land leads to a mismatch of power, which is ultimately not conducive to community.


I want to buy in...

No one can buy into an EVA community. They are based on relationships and not transaction.


Why not a Multiple Occupancy (MO) or other group title?

Group titles, means that a group of people own the land, usually through the purchase of a share. If someone has to move on, due to personal circumstances or prolonged conflict, a group needs to find someone who can buy their share, which is often extremely difficult. If someone is kicked out, and they require their money, they can also force the sale of the property, which is a risk we were not prepared to take.


Why not a body corporate?

Body corporate stricture was never meant for communities. Houses are sold off to the highest bidder, and the increase in property value eventually makes the community unaffordable. It also requires people to get mortgages, go to work in jobs that most often they hate, and doesn't support healthy human relationships. We wanted something different.


Can I build by own house on the property?

No. The land and the buildings are all under collective stewardship. If someone wants to build, then the community will pay for it, perhaps even help build it. There are two main reasons for this 1). Simplicity. 2) Occupancy problems. In many ways, Australia doesn't have a housing problem - there are somewhere between 8 and 14 million spare bedrooms any given night (and yet we are still bulldozing koala habitat). So if people build their own three bedroom place for children, the kids will leave one day and leave the parents with unoccupied bedrooms. If the community owns the buildings, the residents are able to occupy the space that suits them, and we can get close to 100% occupancy.


So you don't sell lots?

No. When communities sell lots, they lose control of who buys them next. Profits will most often beat community culture. Over time, lots are sold on the open market or bequeathed to children, who often don't have a commitment to community.


Can I get a mortgage?

No. We try to access housing without mind numbing and soul crushing mortgages. everyone has a different capacity. There are some people who have money, and are lonely; and there are others who have little money and lots of time and energy. This model allows people with different capacities to live together.


So how do you get out?

Stop paying rent. Healthy communities are seen as 'hard to get in, easy to leave'.The easier it is to leave, the less problems the community will have.


Article 4 of 6. Next article - 5. Financial Model