The Role of Community Land Trusts in Cascadia’s Quest for Affordable Housing

The housing crisis that plagues most major cities always puts renters on the losing side as they face increasing housing instability. Rising rents and affordable housing shortages are pushing lower-income residents out of their neighborhoods in favor of the rich. One of the biggest housing policy challenges in growing cities is how to invest in low-income communities—provide walkable, amenity-rich neighborhoods with abundant and affordable housing, without displacing vulnerable residents. The preferred answer of residents and advocates has long been clear: ownership!

Unlike renters who are stuck paying whatever hike the market demands, people who own their homes can benefit from local investment.

Unlike renters who are stuck paying whatever hike the market demands, people who own their homes can benefit from local investment. As families throughout Cascadia feel the pinch of rising housing costs, more cities of all sizes are turning to the Community Land Trust (CLT) model to extend ownership opportunities across the income spectrum.

As housing advocates have long argued, CLTs halt displacement in its tracks in two main ways: they help low-income renters become owners, and they ensure permanent affordability by limiting the price at each resale. [Some CLTs also provide affordable rentals for very low-income people who can’t acquire a mortgage.] For communities under threat of displacement, CLTs can turn around a family’s fate by providing not only stable, affordable housing, but also an opportunity for wealth-building otherwise out of reach.

CLTs first cropped up in Cascadia 45 years ago, and today the region holds around 2,365 CLT homes run by 18 different CLT organizations in urban and rural communities. Nine new Cascadian CLTs are also in the works.

The region’s operating CLTs demonstrate their viability as an equitable housing solution and their potential to serve more communities. But CLTs provide a small number of homes within Cascadia, only 0.03 percent of total housing stock, which is understandable because scaling up CLT housing would require vast public investments. In Washington state, for example, the state allocated only 2.5 percent of Housing Trust Fund dollars to CLTs in 2017.

This lack of funding is the same roadblock that precludes cities from even coming close to meeting the need for other types of subsidized housing, too. On top of the cost to build homes, CLTs looking for land to take out of the private market are up against the gargantuan economic scale of real estate capitalism. Raising the share of CLT homes in a major Cascadian city to say, 10 percent, would necessitate spending billions of dollars on land alone.

In this article I present a survey of CLTs across Cascadia that testifies to the trailblazing work already accomplished and the promise of CLTs to bring stability to more Cascadians. In a follow-up I’ll explore the barriers to scaling up CLTs and solutions for overcoming them.

What is a CLT?

CLTs are non-profit corporations that acquire land and develop housing, which they sell at below-market rates. CLTs typically serve low- to moderate-income households earning 50 to 80 percent of the area median income (AMI). Some CLTs also provide affordable rentals, typically serving low-income households. In Cascadia, most CLTs offer ownership and rental homes.

For ownership, the CLT owns the land and the resident owns the home, with use of the land granted through a 99-year ground lease. CLTs restrict the price at each sale using a variety of formulas, such as fixed-rate, appraisal based, or AMI based. These caps typically limit appreciation to 1.5-2 percent annually. In most cases, owners acquire less equity over time than would the owner of an unrestricted home.

Critics argue that because CLTs limit the accrual of equity, they create a “second-class” of homeowners, compared with owners of market-value homes. But for those who cannot access the traditional housing market, ownership with less equity is better than no ownership at all. The equity built in a CLT home can sometimes help CLT owners to purchase a home on the open market. For example, according to representatives of Proud Ground CLT in Oregon, of the 15% of homeowners who sell their home, 54% of their homeowners go on to purchase their own home.

Compared with standard subsidized rentals, CLTs can offer greater permanence, using a one-time subsidy to preserve long-term affordability. By perpetually restricting resale of the home, the CLT preserves the initial subsidy over time. In contrast, subsidized rental projects often require ongoing funding to cover operating expenses, and many can also be at risk of market-rate conversion when federal tax credits expire.

The birth and growth of CLTs

In 1969, a group of Black farmers and civil rights activists in Albany, Georgia, founded New Communities Inc., which was the first CLT in the United States or Canada. They created it to help Black farmers facing threats of eviction due to their participation in the civil rights movement. From its inception, the CLT’s mission was to help Black residents stay rooted in their communities and protect against displacement.

Today, depending on who’s counting, there are somewhere between 225 and 300 CLTs nationwide in the United States, the largest being the Champlain Housing Trust in Vermont with 2,765 homes. American CLTs are predominantly concentrated in the Northeast, but Cascadia has a growing CLT network dating to the late 1980s.

Most CLTs begin through community-focused or affiliated groups such as neighborhood associations, community organizers, community development corporations (CDCs), or religious coalitions. When starting a CLT, organizers typically seek buy-in from the low-income community the CLT would serve, and support from government agencies, nonprofit organizations, housing industry advisors, local businesses, and banks. To move from idea to reality, CLTs must raise funds for land acquisition, development, and operations.

Under the classic model, a CLT is governed by its members, which can include current and future residents, community members, and general representatives (public officials, local funders, local housing/social service providers, etc.). The members elect a governing board, which usually includes a balanced representation of CLT residents, community members, and general representatives, giving all stakeholders a voice in determining the CLT’s future.

CLTs in Cascadia

Sightline defines Cascadia as encompassing Washington, British Columbia, Idaho, and Oregon, as well as small parts of Montana and California, and southern Alaska. Similar to much of North America, many communities across Cascadia are facing a housing crisis. Nationally, 47 percent of renters are cost-burdened, spending over 30 percent on housing costs. Some 46 percent of renters in Washington  spend 30 percent or more of their income on housing, as do 49 percent in Oregon, and 42 percent in both Idaho and British Columbia. Among renter households earning less than $50,000 per year, 77 percent spend 30 percent or more of their income on housing in Washington, as do 76 percent in Oregon, 65 percent in Idaho, and 71 percent in British Columbia.

For over four decades, Cascadian CLTs have been safeguarding residents against rising home prices. The region’s first was the Evergreen Land Trust, founded in 1974, which includes four cooperative homes and three farms.

Today, CLTs provide an estimated 2,365 affordable homes in Washington, Oregon, Idaho, and British Columbia. These homes are a promising achievement, but they represent just 0.03 percent of the region’s 7.5 million homes, which does not address the need for permanently affordable housing.

Cascadia’s largest CLTs are located in its three largest cities: Seattle, Vancouver, and Portland. Seattle’s Homestead Community Land Trust, Portland’s Proud Ground Community Land Trust, and Vancouver Community Land Trust make up 64 percent of the region’s CLT homes. Homestead operates 215 homes and Proud Ground operates 280.

Vancouver’s Community Land Trust, by far the largest in the region, has 1,000 CLT homes and plans to construct 1,700 more—a production rate far outpacing other CLTs in Cascadia. That past success and high rate of future growth arose from unique local circumstances: a strong partnership with the city, a history of co-op conversion to CLTs, leased city-owned land on which to build, and a large, established, quasi-governmental organization capable of building and managing a big stock of CLT homes.

In terms of the number of CLT organizations, Washington currently leads the Cascadian pack with 17. Idaho has two CLTs; Oregon, three; and British Columbia, four. CLT capacity and pricing varies by location. In general, compared with rural CLTs, urban CLTs tend to have more units and higher prices that reflect more expensive local housing markets.

See the table below for a rundown of all of Cascadia’s CLTs:

There are also 9 Cascadian CLTs that do not have homes yet: Africatown CLT (WA), Chelan Valley Housing Trust (WA), Hogan’s Alley Land Trust (BC), Homes and Hope CLT (WA), Kor CLT (OR), Moscow Affordable Housing Trust (ID), Spokane CLT (WA), Thurston County Land Trust (WA), and Waldron CLT (WA).

CLTs have inspired other housing providers, like Habitat for Humanity, to use the CLT ground lease and affordability requirements to provide permanently affordable housing. For example, Habitat’s King County chapter provides over 160 permanently affordable homes. Other Habitat chapters in Washington, Oregon, and Idaho work in partnership with CLTs or established their own land trusts, which don’t typically operate under the classic CLT model.

How do CLTs operate in Cascadia?

What will it take to scale up CLTs?

Homestead townhomes. Photo by Nisma Gabobe, used with permission.

CLTs have fostered community-controlled affordable housing in select Cascadian communities. Today, the region’s 18 operating CLTs and 2,361 homes demonstrate that they can be a viable way to deliver housing security for low-income people. Their numbers are large compared with where they started 30 years ago, but they remain a fraction of one percent of Cascadia’s dwellings. Why don’t we see more of them?  

The main barrier is lack of funding. In a follow-up to this article, I’ll examine funding barriers and suggest solutions for boosting the production of CLT homes. 

Note:

*Africatown CLT previously partnered with Capitol Hill Housing to convert the Liberty Bank building into affordable housing. The Liberty Bank Building is owned by Capitol Hill Housing as the developer, and after a 15 year tax credit compliance building, Africatown Community Land Trust and Byrd Barr Place have a right of first refusal to own the building. 

Update, Sept. 27: This article has been updated to include data from Sabin Community Development Corporation’s CLT stock.

Update, Sept. 30: This article has been updated to include information about Habitat for Humanity’s land trust homes.

Update, Oct. 25: An earlier version of this article stated that the first Cascadian CLT was Lopez CLT, which was the first to operate under the classic CLT model involving income and resale restrictions.

Acknowledgements: Thanks to Kathleen Hosfeld with Homestead Community Land Trust for providing key insights on CLT practices and initial data on CLTs in Washington and Oregon. Thanks to Jackie Keogh at Proud Ground, Brian Shelton-Kelley at NeighborWorks Umpqua Community Development Corporation, Stephanie Allen at Hogan’s Alley Land Trust, Tamara White at Community Land Trust in Vancouver, Michelle Griffith at Arch Community Housing Trust, Nils Peterson at Moscow Affordable Housing Trust, Kendra Meyer at Kulshan Community Land Trust, and Loulie Brown at Sabin CDC  for sharing their CLT expertise and providing information about their organizations. Thanks to Jenee Gaynor and Vince Wang at Grounded Solutions Network for their insights into the national and regional CLT movements.