Machynlleth Housing Cooperative is seeking expressions of interest for a loan stock investment opportunity, a chance to invest in ethical, sustainable and affordable housing in Mid-Wales
- Share offer open from August 4th until September 8th
- Invest anything between £1,000 to £10,000
- 0-3% interest from 5-20 years
- Total amount sought: £40,000
Who are we?
We are Machynlleth Housing Co-operative, a registered not-for-profit organisation. We exist to provide sustainable, democratic tenant-controlled affordable housing, while being a welcoming space for the local community and contributing to broader positive social change.
One of our houses (known locally as ‘The Clubbhouse’) has been a shared house rented by a group of friends for over 10 years. As we believe in Co-operative values and principles, in 2012 we formed Machynlleth Housing Co-operative and began leasing the property as a Co-operative.
With your help, we would like to buy The Clubbhouse this year!
We live communally, sharing responsibility for cleaning, organising and cooking meals most evenings. We meet together three times a month to make decisions and carry out maintenance on the house. We organise non-hierarchically and use consensus to make decisions reflecting our values.
The Co-op currently has ten members, six in the house we want to purchase and four in a second leased house. As a group we have a diverse range of interests, skills and lifestyles, from ecological activism to engineering, midwifery to woodland management. We also have much in common that brings us together, such as a commitment to positive social change, living cooperatively, and a love of the outdoors.
What’s a Housing Co-operative?
Housing Co-operatives are registered not-for-profit organisation where tenants have full and equal control over their housing situation, without owning it personally.
Housing Co-ops encourage Co-operation between tenants and between Co-ops, rebuilding a sense of community.
If the Co-op should ever cease to exist, the assets have to stay within the cooperative movement rather than going to members personally.
How will we buy the house?
- We have agreed a price of £150,000 with the current owners
- To reduce the environmental impact of the house, we would like to install external wall insulation and solar photovoltaics. We estimate that this will cost around £15,000. We are in the process of applying for planning permission for this work.
- We are applying to the Ecology Building Society for 80% of the house price and the cost of the energy efficiency measures. We are aiming to get a mortgage of around £132,000.
- We are seeking loan stock to fund the remaining 20% of the house price and the cost of energy efficiency measures, as well as the cost of house buying (solicitors fees, survey, etc.). This is around £40,000.
What is loan stock?
‘Loan stock’ is a term used for money invested in a Co-operative by external parties. One of the advantages of loan stock is that it is a direct agreement between the Co-op and the investor, so the full amount goes directly to the coop rather than to a bank or any other intermediary services.
The loan stock is not secured on the Co-op’s house, but is instead financed by rental income from members. Loan stock is the form of a “stock” rather than a share, therefore it does not give the lender any powers or rights over the running of the Co-op.
Why should I invest?
We are offering an opportunity to join us in this social housing project that will increase access to affordable, tenant-controlled housing in rural Wales whilst also offering a good return on your investment. Supporting this project is a way of supporting sustainable development and ensuring safe, stable and supportive housing for generations to come.
How much can I invest and at what interest rate?
You can invest anything from £1,000 to £10,000.
We are offering interest rates between 0 and 3%.
We are also open to other offers. Do you want to loan us a different amount, or for longer? Tell us about it below and we’ll get in touch.
When will I be repaid?
You can choose a loan period between 5 and 20 years. It’s better for us for the loan period to be as long as possible. At the end of this period the coop pays you back the full amount plus interest at the agreed rate.
The grid below shows how much you would be repaid at the end of the loan period, based on how much you invest and what interest rate we agree.
When can I invest?
If you’d like to invest in our loan stock offer, please complete our loan stock form.
Once the deadline of September 8th passes, we will assess the loanstock offers and contact you to let you know whether we have accepted your offer or not within two weeks, by September 22nd. If we accept your offer we will ask you to sign a letter pledging the investment, subject to us getting a mortgage.
If there’s anything more you’d like to know, just get in touch!
Email us: firstname.lastname@example.org
Machynlleth Housing Co-operative Limited is incorporated under the Industrial and Provident Societies Acts 1965 to 1978: Registered number: 31642R. Registered office: Yr Hen Olchdy, Heol y Doll, Machynlleth, SY20 8BQ