Housing for All
“In the richest country in the history of the world, every American must have a safe, decent, accessible, and affordable home as a fundamental right.”
Senator Bernie Sanders
Read about the Yellow Springs, Ohio Community Land Trust model here.
One of the reasons I started this newsletter is to share with as many people as possible, what I have learned and continue to learn as an “income and wealth-challenged” person. I often say to my friends (or dog or cat, whoever might be available to listen), “Who knows that “this” is going on in our country?” “How could the average person have the time or the inclination to find out about “this”?” “Why isn’t “this” ever discussed on the national news?”
I’ve already written about several of these issues here, like the cruel Catch-22 of credit scores, the value to our country of a Universal Basic Income, the shocking reality of Pay Day Loans, the conundrum of our personal bankruptcy laws, and our country’s growing income and wealth inequality.
But what I have been focused on most recently, as have a few elected officials, authors and journalists, is the growing gap between the very rich and everyone else, and along with this, the erosion of the middle class. Last week, I happened to stumble upon a Tweet from the Sanders Institute, where it touted Senator Sanders’ creation of a Community Land Trust when he was Mayor of Burlington, Vermont. According to the Institute’s article, “The Burlington Community Land Trust, today named the Champlain Housing Trust (CHT), was started in 1984 with a substantial grant and technical assistance from the City of Burlington. It was the first CLT in the United States to be initiated by a municipality.”
I also read a 2016 article from Slate Magazine titled How Bernie Sanders Made Burlington Affordable, written when the good senator was running for President the first time and shaking up our country with his “radical” ideas…designed to help average working people.
A community land trust happens to be one major tool to close that wealth gap. How? It turns out that the “American Dream” of home ownership is in fact, one of the best way to build wealth. But many of our country’s low income residents can’t afford the downpayment, the property taxes on both the land and the structure, or the inevitable repairs, which shuts them out from increasing their overall wealth. The alternative to building wealth for individuals is investing in the stock market, which most lower income people simply don’t have the extra money to do.
A community supported land trust owns the property and builds or refurbishes the homes, then sells them at below market prices to residents who meet a certain income threshold and can still afford the lowered payments—the buyer owns the home and the trust retains ownership of the land. This separation of land and structure ownership allows the owner to only pays taxes on the structure, purchase the home at a reduced price, pass the home to their heirs and earn a shared equity on the sale of the home. (The equity realized on a sale typically is shared between the homeowner and the land trust to allow the trust to re-sell the home to another low income resident at a reduced price.). The trust also usually assists with repairs on the structure, which allows the owner to focus on making the mortgage payments and building equity.
lt also keeps the affordability of the community trust housing permanent— the other types of government subsidized housing can fluctuate because most are dependent on annual subsidies and are unable to keep pace with the increased demand for affordable housing.
“…CLTs are a valuable tool in closing the wealth and equity gap in cities with significant racial disparities.”
And it seems that the community land trust model is slowly catching on. The City of Baltimore, for example, announced this past September that it was allocating $4 million available for funding the City’s land trusts. According to Baltimore’s mayor, Brandon Scott, "The Community Land Trusts movement represents both a tangible and scalable strategy to help us build community power." There are approximately 277 land trusts operating in the United States today.
What do you think of the Community Land Trust model to help low income members of a community build wealth through home ownership, and so “build community power”?
I’d love to hear your thoughts.
If you like what you’ve just read, it would be great if you could share this post with your friends and family.
As always, thanks for reading and commenting!
Community Land Trusts