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FAQ.
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How do Community Land Trusts Benefit Residents/Home Buyers?
Lots of ways! There are over 300 community land trusts around the country and they have a legacy of positive impacts on their residents:
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Access: The CICLT is designed to assist people who could not otherwise access or compete within the traditional homebuyer market in becoming homeowners. Households who sacrifice quality or location or stay renters without support.
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Wealth Building: Homeowners build equity through paying on the principle of their mortgage and share in the appreciation of the value of their home. Neither of those chances at wealth building were available as renters. In addition, by getting people into mortgages they can afford, the CICLT enables people to use their budget in a way that supports their goals.
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Stability and Support: For homeowners, there is stability in a consistent place to live that is within budget. Nationally homeowner turnover within Community Land Trusts is very similar to that of the traditional market—around seven years. . As a result of the stewardship built into the model, the foreclosure rate for CLT homeowners is significantly below the overall national average.
2
How do Community Land Trusts Benefit Neighborhoods?
Lots of ways! There are over 300 community land trusts around the country and they have a legacy of positive impacts on neighborhoods and communities:
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Investments Last: By creating a tool that supports permanent affordability, public and private subsidy invested to make the home affordable to the initial borrower will "stay with" the home to perpetuate affordability for generations to come, resulting in a continual expansion in the number of homes available and affordable for purchase by low-income families.
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Stability: For neighborhoods, the property remains in the CICLT and is consistently owner occupied. For areas with high rates of negative investor behavior, the CICLT is a consistent and stable neighbor.
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Low Foreclosure: According to the Federal Reserve Bank of Minneapolis in a lookback of data following the 2008 housing market crash, by the end of 2010, the general mortgage market was experiencing a national delinquency rate of 8.8% while the comparable figure for CLT homeowners was 1.3%. At the same time, approximately 4.6% of traditional mortgages were in foreclosure, while the foreclosure rate for mortgagees on CLT homes was only about 0.5%. This demonstrates the stabilizing effects of the stewardship and framework of Community Land Trusts.
3
What is the Ready Buyer Pool?
The Ready Buyer Pool is a group of people who are wanting to buy a home in the CICLT. These individuals have completed Homebuyer Education and Counseling, attended our Shared Equity Info Session, and met our other eligibility requirements. Whenever a new CICLT home goes on the market the Ready Buyer Pool will be notified and have the opportunity to apply for the home. Only members of the Ready Buyer Pool can apply for Buyer Selection of CICLT homes. Read more about how to join the Ready Buyer Pool here
4
What is Buyer Selection?
Buyer Selection is the process of choosing a homebuyer for each home. Only members of the Ready Buyer Pool can apply for Buyer Selection of CICLT homes.
When a home first comes on the market there is a 30 day deadline for applicants to apply for the home. All applicants that have entered the Ready Buyer Pool before the deadline will be notified when a new home comes on the market and have the opportunity to apply for Buyer Selection for the property.
A buyer will be chosen for the home by the CICLT using an objective scoring system ensuring accuracy and fairness to assess a family’s financial and housing stability, ability to benefit from the program, and readiness for future homeownership. The application with the highest score will be selected for the property. If there are multiple applications with the same top score and qualify equally, a randomized lottery may be used to select the final applicant.
5
What is a Ground Lease?
A ground lease is a legal document that sets the terms for using property. A big feature of community land trust leases are terms about keeping the property affordable. This includes a resale formula and how capital improvements can be made to the property—both impacting the long term affordability. All home buyers get counseling about the terms of the ground lease before they purchase a home. Our ground lease is based off a national standard ground lease for community land trusts.
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What is Appreciation?
Appreciation is a term meaning the increase in home value. For example, if a home was valued at $100,000 in 2015 and $175,000 in 2025, it appreciated by $75,000. If a home isn’t kept up, it can lose value. The term for losing value is depreciation.
Appreciation is not the same as equity. Equity in a property is the value of the home less the value of the liabilities. In a traditional market sale, appreciation can have an impact. Because the CICLT does not function in the same way as the traditional market and layers subsidy to get homebuyers into affordable mortgages, building equity can be accomplished by paying down the principal on their mortgage, keeping up maintenance on the home, and capitol improvements.
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First-Time Homebuyer Defined by HUD
An applicant is considered a first-time homebuyer if they have not had an ownership interest in a principal residence in the past three years. This definition also includes:
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Individuals who have never owned a home.
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Single parents who only owned a home jointly with a former spouse.
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Displaced homemakers who previously owned only with a spouse.
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Individuals who own or have owned a mobile home not permanently affixed to a foundation in accordance with local regulations.
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Individuals whose only prior homeownership was a property that did not meet applicable building codes and could not be brought into compliance at reasonable cost.
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Be a military member with discharge of other than dishonorable.