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Limited Equity Cooperatives: The Non-Economic Value of Homeownership

40 Pages Posted: 14 Jan 2014 Last revised: 12 Mar 2014

Julie D. Lawton

DePaul University - College of Law

Date Written: December 3, 2013


This article evaluates the meaning of homeownership for low and moderate income residents who live in a homeownership model that does not provide equity appreciation. For many Americans, wealth creation is one of the major reasons for home ownership. Federal and local governments have for years looked to wealth creation as a means of helping low and moderate-income residents become self-sufficient. However, for many low and moderate income residents, homeownership is not an easily obtainable goal since many low and moderate-income residents have neither the income, nor credit, to qualify for a mortgage for a condominium or single family home. To combat these problems, some affordable housing proponents advocate for alternatives to traditional fee-simple ownership, such as community land trusts and housing cooperatives. One of the major criticisms of these types of homeownership is that they are structured to restrict equity appreciation to promote long-term affordability, and, thus, undermine the value of homeownership. This Article examines one of these alternatives, the limited equity cooperative, to evaluate the non-economic value of homeownership and to help understand why this homeownership model is still valued as homeownership for these owners who have no hope of equity appreciation.

Keywords: Housing cooperatives, Cooperatives, Limited Equity Cooperatives, Coop, LEC, Homeownership, urban economics, real estate, property

Suggested Citation

Lawton, Julie D., Limited Equity Cooperatives: The Non-Economic Value of Homeownership (December 3, 2013). Washington University Journal of Law and Policy, Vol. 43, No. 187, 2013; DePaul Legal Studies Research Paper No. 14-03. Available at SSRN:

Julie D. Lawton (Contact Author)

DePaul University - College of Law ( email )

25 E. Jackson Blvd.
Chicago, IL Cook County 60604-2287
United States

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