About Community Land Trusts

Homes and Hands

An inspiring documentary about three communities where low-income residents have found an empowering way to realize the American dream… owning a home.


Unless otherwise noted, answers to the questions below come from the Institute for Community Economics, a central resource for information on the creation and operation of community land trusts in the United States.





What is a community land trust (CLT)?
A community land trust (CLT) is a democratically controlled nonprofit organization that owns real estate in order to provide benefits to its local community—and in particular to make land and housing available to residents who cannot otherwise afford them.


How many community land trusts (CLTs) are there in the United States?
The number of active CLTs in the United States has more than tripled since 1987, to 130. Geographically, CLTs are spread across 31 states and the District of Columbia. Many rural CLTs have been established to ensure access to land and housing for low-income people and to preserve family farms.1 Urban CLTs are often created to combat the negative effects of speculation and gentrification.2


What are the benefits of a CLT?
CLTs provide low-income people with access to land, preserve housing affordability and promote owner occupancy. CLTs may also make land available for community gardens, playgrounds or economic development activities, and may hold conservation easements to protect open space and ecologically fragile areas.


How does the CLT model work?
Land is held permanently by a CLT so that it will always benefit the community. Buildings are owned by the residents who use them. When CLT homeowners decide to move out of their homes, they can sell them back to the CLT or to another low-income household, for an affordable price.


Where did the CLT model originate?
The community land trust model was developed in the 1960s by the founders of an organization called Institute for Community Economics (ICE). ICE continues to be the national intermediary and primary source of technical assistance and informational materials for a growing national community land trust movement. Through its Revolving Loan Fund, ICE has loaned more than $34 million to community organizations in 30 states since 1979.3


What are the principals behind CLTs?
The CLT model is rooted in several distinct philosophical and historical precedents. Among these are “the religious and ethical principle that there is both an individual and a community interest in land; India's ‘Gramdan’ system where villages act as trustees of land made available for individual use; and European and North American ‘land bank’ programs in which public agencies hold and then sell or lease land, often to help preserve family farming or encourage economic development.”4


What kinds of groups have started CLTs?
CLTs have been established by a variety of local groups, including neighborhood associations, religious coalitions, community-development corporations, local governments and groups of concerned citizens. Organizing a CLT involves an effort to familiarize the community with the CLT concept and to develop grassroots support and participation.5


What types of housing are found in CLTs?
A CLT may build new homes, rehabilitate older homes or acquire existing housing that needs little or no renovation. Many types of structures are possible, including single-resident-occupancy (SRO) facilities, single-family homes, condominiums, units situated in a cooperative setting or even mobile-home parks.


In what ways do CLTs benefit low-income neighborhoods in particular?

The problems of low-income neighborhoods typically revolve around disinvestments and absentee ownership. With a CLT, residents themselves can capture the value they create so that it benefits their own community rather than absentee investors.


How do CLTs acquire property?
In most cases, CLTs acquire property in the same ways as other nonprofit organizations. As tax-exempt organizations, they sometimes receive gifts of property from individuals or corporations and quite often acquire city- or county-owned property from local governments. But in many cases, they purchase property in the open market—often with the help of funding from public sources.


How does the CLT make sure that the home will be affordable—and available—for other lower-income households?
CLT homeowners and their descendents have a right to occupy and use the leased land for as long as they wish, provided that they abide by the terms of the land lease. These terms place some limitations on the resale of the home—preventing resale to a household that does not qualify as low or moderate income, and limiting the sales price to keep it affordable. The lease lays out a "resale formula" that determines the maximum allowable price.


Can CLT homes be inherited?
Yes. A CLT home is an asset that can be left to the owner’s children or to anyone else the owner chooses. When a home is inherited, most CLTs will allow the heirs to live in the home if they are (1) children of the deceased owner, or (2) have already lived in the home for a period of time, or (3) qualify as low- or moderate-income households.


How are CLTs governed?
CLTs are usually organized as “membership corporations," with boards of directors elected by the members. CLTs are generally governed by three types of boards of directors: those representing resident members, those representing members who are not CLT residents and those representing the broader community interest.


What types of resources exist to fund the development of CLT housing?
CLTs usually rely on the same resources as other affordable homeownership programs—including grants from government programs, contributions of property from both public and private sources, and volunteer labor. In addition, the 1992 federal Housing and Community Development Act makes specific provisions for CLT funding under the federal HOME program, which provides block grants to municipalities and states to be used for affordable housing programs in their jurisdictions.6


Why are more communities becoming interested in CLTs?
In many communities, population growth and economic investment are driving up real estate prices so that fewer people can afford to live in the communities where they work. Fewer still can afford to buy homes in those communities. Limited public funds are available to subsidize housing costs for lower-income households, but the gap between the amount of subsidy needed and the amount of subsidy available continues to widen as housing costs soar. CLTs provide a stable, proven solution: Low-income residents are able to own homes, build equity and enjoy tax benefits in real estate markets that would otherwise be out of reach. At the same time, the inflation of value is avoided, lowering housing costs dramatically and preserving affordability for future generations.


Sources

1 Institute for Community Economics, “The CLT Model”
2 Peterson, Tom. “Community Land Trusts: An Introduction” Planning Commissioners Journal (1996), Issue 23
3 PolicyLink, “Equitable Development Toolkit: Beyond Gentrification” (Information about financing for CLTs is found by clicking on “The Toolkit,” then “Financing”)
4 Peterson, Tom, ibid.
5 Institute for Community Economics, “CLT FAQs”
6 PolicyLink, ibid.

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