Co-operative building societies provided finance that allowed some Australians to achieve the Australian dream of home ownership in the period following the Second World War. The Great Depression had led to a decline in savings and building activity, with major banks reluctant to provide housing finance to low- and middle-income earners. The NSW Government legislated to stimulate building construction and increase the quality of housing by encouraging the formation of co-operative building societies, terminating societies underwritten by a government guarantee. Groups of individuals, with a community of interest such as locality or workplace, enrolled 30-40 members and elected a Board of Directors to negotiate with a lending institution for finance. Once the finance was arranged the society would be registered and a government guarantee extended to the society. The idea extended to other states such as Victoria, where they were called co-operative housing societies.
The number of co-operative building societies in NSW grew from 382 in 1947 to 3,124 in 1975 with membership increasing from 37,684 to 68,712. They formed clusters to cut costs in administration with the Northern Districts Home-Building cluster in Epping, a Sydney suburb, establishing 56 co-operative building societies by 1975. Co-operatives, ethnic associations, employers, trade unions and friendly societies sponsored them. The popularity of these societies was fueled by the continued reluctance of banks to provide finance for housing in the immediate post-war period and continuing regulatory constraints in the 1950s and 1960s. From the 1980s the co-operative building Societies virtually disappeared as the NSW Government encouraged them merge into non-terminating co-operatives and eventually withdrew the government guarantee. As Australians currently face a cost of living and housing crisis the co-operative building societies provide a significant and successful co-operative solution from the past.
For further details, please download Greg Patmore, Nikola Balnave and Olivera Marjanovic, A History of Australian Co-operatives 1828-2023.