The Basics

What are CLTs: Community land trusts (CLTs) are nonprofit organizations formed to preserve housing affordability over the long term. They do this by selling homes to low- or moderate-income families, but retaining ownership of the land under these homes. Buyers of land trust homes agree that when they move they will sell their home to another low- or moderate-income family at an affordable price. By owning the land under the house, the land trust ensures that the subsidy is retained for the benefit of subsequent families. (adapted from Creating Permanently Affordable Homeownership through Community Land Trusts by Rick Jacobus and Amy Cohen)

Where are CLTs used:

§ In fast-growing areas, where the price of real estate is escalating rapidly. They can be used in gentrifying areas to preserve a community's character, and limits on resale prices ensure that some housing remains affordable even in these areas.

§ In disinvested neighborhoods, CLTs can be used to increase owner occupancy, decrease absentee ownership, improve the physical condition of housing and stabilize the community. Such CLTs assist not only the buyers of the CLT's homes, but also existing homeowners in the area, who likely are lower income families.

§ In expensive resort communities, CLTs can provide housing for the community's workers.

§ In addition to residential uses, CLTs have constructed community facilities, businesses, parks and other types of facilities. CLTs can be located on a contiguous site or can be jurisdiction-wide.

Pros/cons of CLTs

§ Pro: CLT is a flexible strategy—it can be used in different kinds of areas, as noted above. All kinds of housing types can be provided in a CLT—owner or rental housing, single family of multi-family. CLTs also can be used to provide economic development opportunities for the neighborhood

§ Con: Some believe that a negative of CLTs is that the owner does not realize the full benefit of building equity—the equity is shared with the land trust because the owner does not own the land. There are many responses to this concern, depending on the particular CLT. If the CLT is in a gentrifying area (such as Winter Park), home appreciation likely will happen at a faster rate than a home the buyer could purchase on the market. In the Winter Park CLT, the buyers purchased the homes at a price far below the market value, so the equity they build should be commensurate with their investment.

CLT Examples

A list of CLTs can be found on the Institute for Community Economics website. Following are examples of some of the most established CLTs and CLTs with unique characteristics.

§ Durham CLT, Durham North Carolina. The Durham CLT is an example of a land trust in a disinvested area. This article describes the CLT and the area in which it is located.  An interesting detail in the article: of the over 100 units of affordable housing created by the Durham CLT since its incorporation in 1987, only two have been sold.

§ Burlington CLT, Burlington, Vermont. The Burlington CLT, incorporated in 1984, is one of the largest CLTs in the US. It is a city-wide CLT with owner and rental housing, and the CLT also has developed a neighborhood park and community facilities. The Burlington CLT manages over 300 rental units, and recently built a mixed use development that includes apartments as well as commercial and retail uses.

§ Newtown Community Development Corporation CLT. The Newtown CLT in Tempe, AZ, is buyer driven—potential buyers are helped through a process to get them ready for home ownership, including a matched savings program to help them save for a down payment. Newtown's ground lease rider and right of first refusal for the CLT in case of sale are recorded at time of sale, and they intend to incorporate the ground lease features into a condominium covenant in order to add scattered site condominiums to the land trust. Newtown has partnered with Habitat for Humanity to build homes.

§ Sawmill CLT, Albuquerque New Mexico. This CLT transformed an old lumber yard into housing, a park, plaza, community center, offices, retail space, manufacturing, senior apartments, and live/work spaces for home businesses.

§ Middle Keys Community Land Trust, Marathon, Florida, and the Bahama Conch Community Land Trust, Key West, Florida, provide housing for employees who work in these resort communities, where housing is extremely expensive.

§ Hannibal Square Community Land Trust, in Winter Park, Florida. The first land trust in Central Florida, Hannibal Square is located in Winter Park's historic African American community. One of the goals of this land trust is to maintain community character in a rapidly gentrifying area. The homes were designed through a local program called Art in Architecture, a community service program of the Orlando Regional Realtor Association, and the homeowners were able to purchase homes with a market value of $350,000 for $126,000. (See Project Profile at right.) Future plans for the land trust include providing economic development and employment opportunities for community residents.

Resources/links

§ Institute for Community Economics: The Institute for Community Economics (ICE) is a national community development organization promoting economic justice through community land trusts (CLTs) and community investment. As the originator of the CLT model, ICE has supported the growth of CLTs across the United States and Canada. ICE is also a certified Community Development Financial Institution with a $13 million loan fund which provides financing to CLTs and other non-profit groups.

ICE provides technical assistance to community-based organizations working to promote community control of local land and to develop permanently affordable housing. Priority for technical assistance is given to community land trusts (CLTs) and groups that want to establish CLTs. Direct technical assistance to both urban and rural groups is provided through site visits, telephone and email consultation, and regional and national trainings and conferences. Direct assistance is supported by a range of introductory and technical publications.

The ICE site also has a list of FAQs on topics ranging from starting a CLT to types of CLT programs, how CLTs reduce the cost of housing and keep it affordable, and CLT relationships with governments and other organizations.

ICE also has a revolving loan fund, which has been providing financing for over 26 years. Since its creation in 1979, ICE's Revolving Loan Fund (RLF) has loaned almost $44 million, representing more than 445 loans to community organizations in 30 states and facilitating the development of more than 4,500 housing units. ICE's principal lending goes to community land trusts, limited equity cooperatives, and community-based nonprofit organizations creating housing that is permanently affordable to people with lower incomes. Funds from the RLF are commonly used to finance land acquisition and the acquisition, construction and rehabilitation of housing. Other frequent uses include the acquisition of office space or other property by a nonprofit community service organization.

§ Burlington Associates Community Land Trust Resource Center: The Burlington CLT Resource Center is a comprehensive site with information ranging from CLT 101 (general information about CLTs) to key decisions for starting a new CLT to designing resale formulas and more.

§ The Florida Community Land Trust Institute: The Florida Community Land Trust Institute is a collaboration between 1000 Friends of Florida and the Florida Housing Coalition. Services offered by the Institute are described in their brochure.

§ League of California Cities Institute for Local Government CLT page

§ Policy Link: what is it—how to use it—keys to success—challenges—financing—policy

Publications

§ Linking Community Land Trusts and Smart Growth

§ Smart Growth, Housing Affordability, and Community Land Trusts in the Portland, Oregon, Metropolitan Region: A Case Study