Community Land Trusts

Why community land trusts?

Millions of households in the U.S. are facing housing insecurity due to inflation, stagnant wages, and increasing rent and house prices. Nationally, rents increased 22 percent during a two-year period from 2021 through 2022. Concurrently, the supply of affordable housing accessible to extremely low and very low-income households declined by more than one million units. Low-income renters now spend half or more of their income on housing—leaving little for other household needs, and often nothing to save for the future. While the affordable housing crisis is affecting the entire country, low-income households and historically disinvested communities of color experience the greatest housing vulnerability.

Rising rents and home prices leads to the displacement of existing residents, particularly for households of color. Gentrification is a driver of displacement, preventing residents from benefiting from the economic growth and improved services that accompany increased investment. The cultural, social, and economic rupture that is spurred by gentrification has lasting impacts on housing insecurity. Households of color have fewer neighborhood options they can move to than their white counterparts, further limiting their access to affordable housing, homeownership, and financial stability. 

The lack of affordable housing also contributes to the persistent racial wealth gap. Homeownership is a long-standing pathway to creating and growing intergenerational wealth and economic security in the U.S., yet discriminatory policies and practices from slavery and Jim Crow segregation to redlining and racist appraisals have excluded many people of color from building wealth through homeownership. As of 2022, the homeownership rate was 45 percent for Black households and 48 percent for Latinx households, compared to 75 percent for white households, leaving the racial gap in homeownership largely unchanged since the 1970s. Even when households of color do own homes, they are still more likely to be cost-burdened. 

In the face of these challenges of housing affordability, displacement, and the racial wealth gap, municipalities are increasingly exploring CLTs as a creative solution. As of 2023, Grounded Solutions Network lists 313 CLTs and shared equity entities in the United States, compared to approximately 225 in 2018.

What are the potential benefits?

Community land trusts provide lasting housing affordability, community empowerment, and wealth-building opportunities. The CLT model is a mechanism to provide affordable housing in perpetuity for low-income renters, homeowners, and commercial tenants. CLTs are structured in a way that the CLT can uncouple ownership of the land from ownership of buildings on the property. In other words, a CLT would own the land underneath a house that was owned by a resident. In this arrangement, limiting the value of the land and the house allows CLT homeowners to pay below-market prices. In exchange, residents agree to restrictions on the resale value of their property. This “shared equity” ownership model keeps the home affordable for future buyers while still allowing the owner to build wealth. 

Community land trusts offer the following potential benefits:

• Increasing economic security: CLTs protect residents from market fluctuations and rising rents, allowing them to build financial stability over time. By removing land and housing from the speculative market, CLTs enable families to invest in other areas of their lives, such as education and healthcare, leading to overall improved economic security.
• Expanding sustainable homeownership: CLTs maximize the impact of initial public investments through resale price restrictions and equity-sharing agreements, ensuring perpetual affordability for low and moderate-income homeowners. For people of color and low-income households who are most affected by the affordable housing crisis, a CLT provides opportunities for homeownership and generating wealth over time. According to a 2021 survey conducted by the California Community Land Trust Network, 60 percent of residents said their household’s economic security improved after moving into a community land trust home.
• Mitigating displacement: By preserving affordable housing in neighborhoods undergoing gentrification and predatory development, long-term residents are able to stay in place despite increasing property values and living costs. When supported by both the community and local government, CLTs can effectively prevent displacement for low-income, Black, Latinx, Indigenous, and other underserved populations.
• Community empowerment: CLTs are governed by nonprofit boards that include CLT residents, community members, technical assistance providers, and other stakeholders. These boards collaborate to decide how the CLT will acquire and develop land to meet community needs. Beyond collaborative community-decision making, CLTs improve physical and mental health and enhance outcomes for children and adults.
• Equitable development: CLTs promote equitable development by ensuring that neighborhood improvements and ownership benefit existing residents, preventing the exclusionary effects of gentrification.

How do you design and implement an equitable community land trust?

Community land trusts have a rich history rooted in principles of racial justice, land justice, and community ownership and control. Their origins trace back to Indigenous practices of communal land stewardship as well as global land reform movements in India, Latin America, and Africa. In the 1960’s, the modern CLT model in the U.S. emerged from Civil Rights organizing as a strategy for Black farmers and former sharecroppers to achieve collective land ownership. In rural Georgia, activists established New Communities Inc., the first CLT, purchasing nearly 6,000 acres with federal assistance for Black families to cooperatively own and retain all proceeds from their labor on this land. Building upon this legacy, CLTs can be designed and implemented with equity as a priority, ensuring that long-term affordable ownership and community control are preserved and accessible to marginalized communities. 

Local governments can play a significant role in supporting CLT formation, sustaining operations, and expanding housing development in the following ways:

• Invest in CLT formation and expansion: CLTs need external funding to acquire land, develop housing, and rehabilitate properties. Initial funding is crucial for new CLTs, which may take years to become financially self-sustaining. Jurisdictions can provide funding through housing trust funds, subsidies, and government grants, as well as support CLTs in acquiring land. Baltimore annually allocates over $15 million to its Affordable Housing Trust Fund for CLT projects, prioritizing communities most in need of affordable housing. Seattle has shown how a jurisdiction can transfer city-owned land at no cost to a community land trust, supporting deeper affordability during the early formation stage.

• Partner with BIPOC-led community land trusts: Beyond financing, cities have demonstrated their commitment to community land trusts as an equitable housing solution by partnering with BIPOC-led CLTs, ensuring that development and preservation meets community needs without causing displacement. The long-term partnership between the Black-led Oakland Community Land Trust (OakCLT) and the city of Oakland, exemplifies a promising practice for equitable CLT design. Founded in January 2009 in response to the foreclosure crisis, OakCLT emerged through community organizing, with the nonprofit successfully urging the City to use HUD’s Neighborhood Stabilization Program funds for community-owned housing. This partnership has resulted in continued city grants, loans, and the purchase of county lands for OakCLT, supporting its mission to advance housing and economic opportunities for Black, Latinx, Asian, other communities of color, and low-income residents of Oakland. 

• Community-driven planning: Community-driven planning is a responsive practice that integrates community priorities into development, allowing jurisdictions to leverage community voices in the design and implementation of CLTs. East New York CLT, a Black and Brown-led organization, aims to preserve affordable housing, green space, and commercial space for small business owners of color. The organization led a two-year initiative to investigate how city-owned, vacant, or underutilized lots could support their mission, with a steering committee of neighborhood residents surveying over 250 sites and gathering community input to identify priorities, culminating in the report “Advancing Community-Led planning and Collective Ownership.” The community planning effort led to partnership with the New York City Community Land Initiative for the Public Land for Public Good campaign, influencing legislation that requires the City to prioritize not-for-profit developers and CLTs when disposing of land for affordable housing or other public uses.

• Affirmative Marketing: Affirmative marketing for community land trusts involves targeted outreach efforts for communities of color and low-income communities to ensure equitable access to housing opportunities. This approach includes strategies to inform and engage underrepresented communities about available housing options within CLTs, aiming to decrease barriers to homeownership and promote equitable implementation, such as:

  • Community outreach: Engage with community organizations, faith-based groups, and local leaders to disseminate information about CLT opportunities.
  • Multilingual materials: Provide marketing materials and educational workshops in multiple languages to reach non-English speaking communities.
  • Advertising in diverse media outlets: Partner with community newspapers, radio stations, and social media platforms in communities of color and low-income communities. 
  • Accessible services: Offering assistance with the application process, including translation services and financial counseling, to ensure all applicants have equal access.
    
    Jurisdictions can require affirmative marketing. For example, San Francisco’s Mayor’s Office of Housing and Community Development (MOHCD) requires affordable housing developers to implement affirmative marketing plans to ensure that all residents, particularly households of color and low-income households, are aware of and have access to affordable housing opportunities. New York City Department of Housing Preservation and Development (HPD) mandates affirmative marketing requirements for affordable housing developers, including outreach to communities of color and advertising in diverse media outlets.

• Homeownership education: CLTs facilitate clear pathways to homeownership through comprehensive education and support, making the process accessible and transparent. They employ several practices to ensure the shared equity homeownership model is clear, ensures fair return, and supports access to market-rate homeownership. These practices include providing pre- and post-purchase education about resale formulas that balance affordability for future buyers with a fair return for sellers, financial literacy, and tailored support throughout the ownership period to help homeowners navigate their equity growth and market options. This education prepares CLT members for a smooth transition to market-rate homeownership if they do decide to sell. Additionally, distributing a homeownership manual in plan language, with translations available, helps homeowners understand the policies and requirements of CLT membership. In a survey of 96 CLTs, 98 percent required pre-purchase support, which has been proven to reduce delinquency and foreclosure rates and support the success of CLT homeowners.

• Governance: CLTs promote democratic governance and community-decision making through their board structures, which typically includes homeowners, community members, and nonprofit shareholders. With one-third of board members and one-quarter of executive directors being people of color across all U.S. CLTs, equitable representation is an established equity practice. Board members guide the development, maintenance, and investments of their CLT to stay accountable to community needs and priorities.

• Provide technical assistance: Local governments can support BIPOC-led community land trusts in scaling their work by providing technical assistance. New CLT leaders may benefit from assistance with project assessments, ground lease structuring, funding plans, internal development, and more. In 2019, New York City officials and community advocates launched the Citywide CLT Initiative to support 15 trusts with technical assistance and organizing support. The City collaborates with nonprofit organizations to offer guidance on legal, financial, and operational aspects of establishing and managing CLTs. The initiative’s technical assistance helps ensure that CLTs can navigate zoning laws, secure funding, and develop sustainable housing projects.

• Leverage existing programs: Local governments can support CLT growth by connecting them to existing homeownership subsidy programs. Cities like Portland, Oregon, Chapel Hill, North Carolina, and Chicago, Illinois, have modified their programs to ensure CLT participants are eligible for available resources. Municipalities can also adjust policies to better align with the CLT model. For example, Chicago staff worked to have CLT homes taxed based on their restricted resale value. City and county staff can collaborate with CLTs to align their operations with available public resources and programs.

Where is it happening?

Community land trusts are emerging as a powerful, flexible tool for preserving and providing long-term affordable housing across various cities. ARPA funds and other financial sources have been strategically used to enhance the capacity of CLTs to acquire land and multifamily properties, fund new affordable housing development, rehabilitate vacant homes, and to prevent homeowner displacement. Local governments and CLTs have effectively addressed housing needs by leveraging public assets, preventing displacement, and fostering community control:

Houston, Texas

In April 2023, the Harris County Commissioners Court unanimously approved $15 million of ARPA funding for the purchase of homes through its community land trust program. The County approved this funding for Houston as a part of a broader countywide plan to commit more than $200 million in ARPA funds to affordable housing. With the funding, the Harris County Community Land Trust will purchase more than 100 single family homes in Houston to provide and preserve long-term affordable housing. The program aims to make homeownership affordable for county residents earning less than 80 percent of the Houston area median income and who otherwise have limited access to home buying. A board of CLT residents, community residents, and public representatives (Harris County Housing Finance Corporation) govern the Harris County CLT.

Chicago, Illinois

In January 2023, the State of Illinois passed a supplemental state budget that included $5 million in ARPA funds for the Here to Stay Community Land Trust, investing in their work in Chicago. Support from the Illinois House of Representatives’ Housing Committee made this funding allocation possible. The funding will allow the land trust to scale up its work by purchasing up to 12 homes in the Chicago area over the coming years. Since Here to Stay can only access the funds in 2024 and must completely spend down the funding before selling any of the homes, the organization is exploring options such as rent-to-own, to provide affordable housing to households as soon as possible.

Durham, North Carolina

In January 2023, the city of Durham approved a total of $2.4 million of ARPA funding to the Durham Community Land Trustees, Inc., which will fund three programs aiming to provide more quality affordable housing and protect home ownership for low-income individuals and families. The three programs include: 

• Homeowner and Homebuyer Initiated Program (HHIP): The program will help “prevent homeowner displacement, expand the financial capability of buyers for homeownership, and secure additional permanently affordable homeowner units.”
• Multifamily Acquisition Support and Supply (MASS): MASS will expand the financial capacity of non-profit affordable housing providers to acquire multifamily rental properties and preserve them for affordable housing. 
• Durham Affordable Sustainable Homes (DASH): The program will provide pre-development and construction grants for new affordable housing development in low-income neighborhoods.

Baltimore, Maryland

In September 2022, the city of Baltimore approved a total of $450,000 of ARPA funding awarded to the South Baltimore Community Land Trust (SBCLT). SBCLT will use the funding to acquire and rehabilitate vacant homes into affordable housing for homebuyers in South Baltimore neighborhoods. All homes created and sold by SBCLT will remain permanently affordable creating opportunities for generations to come. 

Mecklenburg County, North Carolina

In September 2022, upon learning that a single landlord was planning to sell 32 homes in the West Charlotte neighborhood of Hoskins, community members and the West Side Community Land Trust (West Side CLT) began strategizing about how to ensure continued affordability and prevent displacement in the long-disinvested but fast-changing neighborhood. Their organizing eventually led to the County investing $6 million in ARPA funds in West Side CLT to acquire and renovate the homes. After renovations, renters will have the opportunity to purchase their homes. This purchase counteracts the trend of corporate landlords buying single-family homes, resulting in higher rents and insecure housing for tenants. 

Los Angeles, California

In September 2020, the LA County Board of Supervisors initiated the LA County CLT Partnership Program, which awarded a total of $14 million from the County’s affordable housing budget to five CLTs to acquire, rehabilitate, and preserve tax-defaulted properties for long-term affordable housing. In November 2020, the Program grew to include unsubsidized multifamily housing, intended to protect renters at risk of eviction due to the COVID-19 pandemic. With the initial county investment of $14 million, the CLT Partnership Program preserved eight multifamily properties with a total of 43 residential units, enabling 110 individuals to live in stabilized housing. The funding was used to cover the full cost of all acquisitions, without debt, and to rehabilitate the properties. Of the occupied units, 95 percent of households are people of color. Residents living in the homes through the CLT Partnership Program expressed a resounding amount of relief. While there was a motion to expand the program, the County has not yet identified additional funding to continue the program.

What are complementary policies?

The following is a non-exhaustive set of complementary policies and/or programs that can help to advance goals similar to that of an investment in a community land trust. 

• Public land disposition policies – Many cities and counties hold surplus land parcels which they can use to promote housing affordability through a variety of ways, such as:

  • Prioritizing permanent affordability, seeking to partner with organizations committed to this principal;
  • Reduce the sale price to bring the property within reach for mission-aligned nonprofits and ensure that affordable housing development is feasible in the near-term; and
  • Maintain data about publicly-owned lots and actively identify land for community stewardship in partnership with CLTs. 

• Tenant/community opportunity to purchase (TOPA) – TOPA is a policy that allows local governments to require landlords to first offer their property to current tenants before selling, aiming to curb real estate speculation and prevent displacement. Washington D.C. was one of the first jurisdictions to implement the policy, while San Francisco went further and created a Community Opportunity to Purchase Act (COPA). COPA allows “qualified non-profits the right of first offer, and/or the right of first refusal to purchase certain properties offered for sale” by the owner.

• Land banks: Land banks are nonprofit or public sector entities that bring vacant and deteriorating properties back into usable condition. Jurisdictions can support community land trusts by establishing land banks and using them to provide a pipeline of properties for CLTs. Together, land banks and CLTs can help a community weather speculative markets and create greater stabilization with affordability. For example, The Albany County Land Bank worked with the Albany Community Land Trust to establish the “Inclusive Neighborhood Program,” which is a land bank that offers properties to the CLT at a discounted price.

• Housing trust funds: Housing trust funds are specific funds that receive ongoing dedicated sources of public funding to support the preservation and production of affordable housing. Housing trust funds are not subject to the restrictions of federal subsidy programs and can be designed to address local needs and priorities.

Acknowledgements

This brief was initially researched and written by Ana Cuevas-Flores and Tulsi Patel of Estolano Advisors, with contributions to the final draft by Ashley Thomas of the Institute on Race, Power and Political Economy. We thank Brian Stromb of Grounded Solutions for their thoughtful review and feedback.