The Community Land Trust Model

A community land trust (CLT) is a private nonprofit organization that acquires and holds land in order to provide affordable housing and other beneficial community-oriented opportunities. CLTs retain land in perpetuity, preventing market factors from causing prices to rise. CLTs sell homes to low and moderate income residents at affordable prices, while retaining ownership of the underlying land. The CLT is able to keep the price of homes affordable by separating the price of the house from the cost of the land.  A long-term, renewable ground lease defines the arrangement between the nonprofit CLT and the homeowner.  If a CLT homeowner decides to sell their home, it is resold at a price affordable to another homebuyer with a limited income. The innovative dual ownership structure of CLTs provides a balance between the desire of homeowners to build equity and live in a stable, supportive community with the goal of preserving affordable homeownership opportunities for future residents.

Process Overview: The OakCLT Model and Foreclosures

1.  The nonprofit Oakland Community Land Trust (OakCLT) acquires vacant, foreclosed homes that can otherwise contribute to neighborhood blight and public safety concerns.

2.  The OakCLT rehabilitates foreclosed homes, including weatherization and energy-efficient retrofitting.

3.  The OakCLT sells the renovated homes to new homebuyers at a price affordable to working families earning 50 to 80% of the area median income ($43,050 to $66,250 per year for a family of four, in Oakland).

4.  The OakCLT retains ownership of the land under the homes, while leasing the land back to the new homeowner (for a 99-year, renewable term).  By retaining ownership of the land and selling the improvements on the land, the OakCLT ensures permanent affordability; subsequent homebuyers will benefit from the same affordable home prices.

For a more detailed description of the benefits of the community land trust model, click here.