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Can community land trusts be used to expand the limited inventory of affordable housing options? A new report from the Center for American Progress (CAP), a left-of-center think tank in Washington, D.C., believes this could be an option.
In the new report “Community Land Trusts: A Promising Tool for Expanding and Protecting Affordable Housing,” CAP argues that this strategy can be used to help transition lower-income families from rental housing to homeownership. In this scenario, a community land trust would acquire and manage the land where affordable homes can be built and sold to income-qualified families at below-market rates. However, any buyer that eventually seeks to move out must agree in advance to resell the property at a price that would be affordable to other low-income owners.
However, the CAP acknowledged that this scenario would not occur in the immediate future. Of particular concern was access to mortgage financing, with CAP urging that the Federal Housing Finance Agency prioritize support for shared equity models including community land trusts.
“The model is still evolving and has not yet achieved the critical mass that would allow it to have a broader impact on the housing market,” said Michela Zonta, senior policy analyst at CAP and author of the report. “However, it is very promising, and it is worth encouraging its expansion, especially because it challenges the conventional housing market through an emphasis on the collective ownership of land in perpetuity.”