Community Land Trust
A CLT is a community-based organization that uses public and private investment to acquire land and provide affordable owner-occupied housing on behalf of a specific community.
How does a CLT work?
Residents can purchase a CLT home, but not the land on which the houses sit. Instead, residents enter into low-cost, long-term property leases with the CLT, known as ground leases, typically for a 99-year period. Although CLT residents can never sell the land their home is on, they otherwise have the same rights and responsibilities as other homeowners (maintenance, taxes, etc.). The initial investment to write down the price of the home plus the removal of the land value is what makes the home more affordable for the homebuyer. In exchange for the assistance provided to enable the purchase of a home, they would not otherwise be able to afford, CLT homeowners agree to limit the price at which they can sell their homes. This still enables CLT homebuyers to build equity and eventually purchase a home in the traditional marketplace. However, it also keeps the home affordable to future limited-income households – without requiring the investment of additional public or private subsidies to make the home affordable again.
What is the Town doing to further this strategy?
In 2021, a CLT Steering Team worked with a consultant to explore the feasibility of establishing a Community Land Trust in Montgomery County. Town and County staff finalized the details of a management and operating model for a county-wide CLT in the summer of 2022. Community Housing Partners (CHP) will be charged with managing the new CLT, named New River Home Trust. They are currently in the start-up phase. The Town sees this as an important affordable housing strategy for providing a housing stock affordable to first-time homebuyers.