A report to a council meeting next week recommends the city buys two two-bedroom units for $690,000 in the High St co-housing project for use as social housing.
The report from property manager Kevin Taylor noted one disadvantage of the plan was additional work for council staff in letting properties in the development, because prospective tenants would need to "buy into co-housing philosophy", and because tenants might need to go through an induction process to live there.
Construction of Dunedin’s first co-housing project is expected to start early next year on the former High Street School site.
The group has resource consent for 26 units, a common house and shared grounds.
Plans for the facility have been under way since 2013.
Urban Cohousing Otepoti Ltd group co-director Catherine Spencer said this week almost all the 26 units, which started at about $240,000 for a one-bedroom unit, had been sold.
Talks were also under way with "a local social housing provider" about the possibility of offering such accommodation to low-income families, she said.
Mr Taylor said yesterday the group approached the council about 12 months ago to "gauge our interest in the project".
"DCC staff have since been investigating whether this development would help to meet the demand for social housing, particularly for one- and two-bedroom homes, where we currently have a shortfall of stock."
Discussions with the group had led to it formally offering the council the option to buy homes as part of the development.
Mr Taylor said the idea had not yet been to the council or its committees for approval.
The co-housing group wanted confirmation the council would make an initial investment in the site, make a cash payment of $5000 to secure the properties, and sign an unconditional sale and purchase agreement.
The arrangement would mean council staff would participate in co-operative meetings to make decisions on the running of the development.
"It is a principle of co-housing developments that people living in the community are on board with the co-housing philosophy.
"This would include an induction process for new tenants, including social housing tenants."
Members also participated in communal work such as gardening and cooking.Mr Taylor said the council would place only tenants who were "willing and able to buy into the group’s philosophy and be active members of the High St community".
"One of the questions council needs to consider is whether it is realistic to be able to attract and place tenants who will want to be active members of the community."
He said the plan was neither better nor worse than the council providing its own housing.
"It is simply another potential option being explored to meet the demand for social housing in our community, particularly for one- and two-bedroom homes, and investment in the project has the potential to support the council’s strategic goals in social wellbeing, social housing, the environment and energy efficiency."
The cost would be about the same as that of a council-built facility.
