What is a community land trust?: A look at one solution to the affordable housing crisis

CLTs offer affordable housing option in Central Florida

Couple who purchased home from Hannibal Square Community Land Trust (Hannibal Square Community Land Trust)

ORLANDO, Fla. – The affordable housing crisis is worsening by the day, with the housing supply at an all-time low and rents reaching sky high numbers, but there are people, projects and organizations out there dedicated to combating the crisis.

One solution to the affordable housing issue that’s currently rising in popularity is community land trusts, an idea that will be further explored in Episode 2 of Graham Media Group’s digital solutions-based newscast, “Solutionaries.”

[READ MORE: A $739 mortgage payment in Winter Park? Here’s where we found affordable housing]

In the meantime, let’s take a look at how they work and how they’re making a difference.

What is a CLT?

Land trusts are formed and operated under nonprofit organizations. That nonprofit acquires land by donation, surplus by local governments or purchase through grants. Once land is acquired, the nonprofit builds homes for low-to-moderate income families.

From there, a family or individual buys one of the homes that sits on the land owned by the CLT, which is more affordable because the buyer is purchasing only the home, not the land on which it sits. Basically, CLTs take the cost of the land out of the equation.

To simplify, here’s an example:

If a typical home in the area is selling for $300,000 but the land value is $100,000, the buyer only has to qualify for a $200,000 loan.

In order to be considered as a buyer, families or individuals do need to qualify. Community land trusts are designed for working families making 80% of the median income.

According to GroundedSolutions.org, the homeowners lease the land from the community land trust in a long-term — often 99-year — renewable lease. The homeowners also agree to later sell the home at a restricted price to help maintain affordability.

CLTs in Central Florida

Can community land trusts solve the affordable housing crisis completely? No, no one thing can do that, but they do serve as one of many solutions to the nationwide issue.

The good news: More CLTs are popping up across the country, including in big cities like Houston and Jacksonville. According to Grounded Solutions, there are more than 275 CLTs in the U.S. and growing as the affordable housing crisis worsens.

Two efforts operating in Central Florida include: Hannibal Square Community Land Trust in Winter Park and Apopka and Housd, the Central Florida regional housing trust.

You can learn more about community land trusts in Florida, including information on how to create one, here.

Solutionaries” is a new digital show that focuses on solutions-based journalism.

Episode 2, which tackles affordable housing and highlights those working to solve the crisis, drops Sept. 20.

You can watch Episode 1, “Policing in America,” here.