Mutual Ownership Defense Housing Division - The Mutual Housing Projects After The Second World War

The Mutual Housing Projects After The Second World War

By the conclusion of World War II, the eight completed mutual housing projects built in 1941 were doing exceedingly well, though federal, state and local governmental support had been and continued to be severely lacking. A number of these projects were reported to be the lowest-costing permanently constructed housing projects ever built by the federal government. Some reports indicated that the cost of development and management of the mutual housing projects had been approximately 50% of the cost for comparably sized regular public housing projects. According to mutual housing supports, the vested interest of corporation members inspired demands for efficient low cost operations. As one resident of Greenmont Village Mutual Housing Corporation stated:

"When everybody owns an equal share of his community and knows that if his neighbor does not do his share, that the village as a whole and, in particular, his own equity will lose in valuation, each owner is interested to see that all people in the community do their share and will also help to educate those who are not true cooperators."

Clearly this type of involvement and concern by residents had a stabilizing effect on the communities, and the increased involvement of residents encouraged greater efficiency. Reports from residents indicate that individuals had actually turned down other employment opportunities because they did not wish to leave the cooperative, neighborly, low-cost environment of their mutual housing project.

The Congress of Industrial Organizations (CI0) was so impressed by the mutual housing program, and so frustrated by the inaction of the federal government in expanding it, that it obtained private financing to build a second mutual housing project next to Greenmont Village in Ohio. This new project differed considerably from the original mutual housing concept however. Residents of this new project owned their own homes, forcing the project into the speculative housing market. The CIO believed that residents would not be inclined to sell out of the project because of the many advantages and benefits of being a member of a mutual housing corporation.

Although only positive reports were coming from the mutual housing projects already in existence, the Housing Act of 1945 made only vague mention of the mutual housing concept. The Act provided only limited resources to promote the program as a private initiative model for groups of returning veterans seeking housing. The National Housing Agency informed Congress that research on the program would continue, and that:

"Records on the projects are being maintained for future analysis and study. They will be available for the guidance of groups interest in this approach to the low-cost housing market and to private capital and developers seeking to broaden the scope of private industry in the field of the so-called 'middle market' in housing."

Only one thin publication on how to create a privately financed mutual housing corporation was ever published by the National Housing Agency. This publication stated that:

"The Federal Public Housing Authority (FPHA) is in the process of disposing of a number of housing projects constructed during the war. The Authority will sell these properties to mutual ownership corporations formed by present and prospective occupants of the specific projects, provided these groups meet the requirements of FPHA (2/3 occupancy at the time of Corporation purchase). Among prospective occupants, veterans are given first preference."

Residents of a number of projects, most located in the midwest and working with the CIO, established a National Mutual Housing Association during the mid-1940s. Colonel Westbrook was a member of the advisory board. This association promoted what it believed was the housing solution of the future, whose time had come. The Chairman of the Association made the following report to Congress:

"...I think it is the most thrilling story of housing that you have heard or will hear, and the only hopeful story that you have heard. We contend that this is the first showing of a hopeful effort, under Government auspices, to solve the housing problem, the first plan to be tried and tested which offers to you any solution of the housing problem. Therefore, we want someone to administer it with faith in it and with faith in the people."

The goals of the Association included the creation of a Mutual Housing Agency in the National Housing Authority to promote the program and at the same time dispose of all war housing projects as mutual housing projects. It also wanted to open the mutual housing program to all citizens regardless of "social, racial, or economic status." Supporters realized that without the government resources or support of this type there could be little hope of the mutual housing program becoming a national program. Once again, however, the concept that public housing was only for the low-income populations had taken hold, and also the concept that only through private initiative and financing, with substantial government support, could the United States provide appropriate middle-income housing.

The red scare of the immediate postwar years also created a negative environment for programs with even the slightest socialistic overtones, which was true for the mutual housing program. The CIO itself, with the creation of its own mutual housing program in which each resident owned his/her own unit, clearly illustrated that the popular housing sentiment of the time was to own your own home. The resulting lack of mutually maintained equity, and the ability of residents to independently sell out of the project, created a speculative market environment that ran counter to the principles that held the mutual housing program together. Additionally, the desire for home ownership and the increasing affordability of middle-income housing, thanks to extensive government subsidies both in the mortgage market and through tax policy following the second world war, ensured that the mutual housing concept was shelved once again.

Both John Carmody (FWA Administrator) and Colonel Lawrence Westbrook continued to be devoted to the mutual housing concept and discussed the final disposal of the eight projects in keeping with the original mutual housing plan. As late as 1952 Westbrook was looking for ways to resurrect this middle-class public housing effort but this plan was abandoned with the election of the Republican administration of Dwight Eisenhower.