Now That There’s a Dip in Housing Prices, We Should Invest in Community Land Trusts for Good

“Now it is time to fast-track CLTs to the top of the affordable housing priority list in our communities and across Canada.”

A Guest Column by y Colin Bruce Anthes

Posted July 5th on Niagara At Large

This May Canadian house prices finally fell for the first time in two years, a period during which the average house price had skyrocketed by an astonishing $300,000.

The spiral at one point saw the House Price Index increase by 29 per cent in a single year.

An unprecedented amount of recent purchasing has been made by private speculators and the mega-landlord initiatives called REITs (Real Estate Investment Trusts), pushing much of the working class off the metaphorical and literal turf.

Everyone agrees Canadian housing needs to change moving forward, but many proposed solutions are band aides or worse. A more enduring approach finally gaining overdue traction in Canada is the Community Land Trust.

With municipal elections on the horizon, everyone ought to be having a gander.

 A (not-for-profit) Community Land Trust, or CLT, takes a plot of land off the market and places it under the permanent control of a local non-profit board. This makes many of our usual challenges around housing and development much simpler.

        Depending on the district, land values usually account for 20-35% of the cost of property. Whereas landlords capture this portion for profit, CLT’s can instead facilitate any kind of development a community wants—housing, enterprise, community gardens, etc.—at a highly discounted rate. Primarily, this strategy is used to provide affordable housing to lower income residents and cheap starter homes for young families. Increasingly, governments around the world—both progressive and conservative alike—are providing subsidies and donating underused land to CLTs. Even Scotland, with a population of under 6 million citizens, has a £15 million ($23.3 million Canadian) annual subsidy to help CLTs purchase land.

            Now it is time to fast-track CLTs to the top of the affordable housing priority list in our communities and across Canada. Unlike other affordable housing strategies, a public subsidy to a CLT only needs to be provided one time to link housing to the affordability rate forever.

Because the market cost of housing skyrockets over time, ever-greater subsidies are needed to maintain traditional affordable housing strategies.

By taking control of the land values, a CLT links housing to affordability through the generations – 

            In other words, CLTs are both the most radical and the most fiscally conservative approach to affordable housing. Providing immediate relief and opportunity, they will still be doing their work well after their founders have left this world.

            Unsurprisingly, CLTs have made life much simpler and more affordable for many of their users. A 2004 study in the United States found that the majority of first-time homeowners failed to keep their home for more than 5 years—and that was before the foreclosure crises. A subsequent study, however, found an astonishing 93% of the first-time homeowners who purchased houses on a CLT kept their homes for over 5 years. Other large-scale CLT projects, meanwhile, have had substantial housing cooperatives developed upon them, with a single CLT providing permanent affordable housing to hundreds of residents.    

            The recent housing bubble experience in Canada shows how unsustainable our usual practices are. The good news is there’s no need to reinvent the wheel. We know from experiences around the world that CLTs work, are democratic, communitarian, bipartisan, and enduring. Subsidies to CLTs now will make our economy and society more sustainable for generations.

It’s time to push them to the top of the priority list, and make good housing housing for good.

Colin Bruce Anthes is a St. Catharines citizen and an organizer with Community Wealth Candidates, which works on local, democratic economics around worker cooperatives, community land trusts, and the progressive use of anchor institutions.               

About Community Land TrustsCommunity land trusts are nonprofit, community-based organizations designed to ensure community stewardship of land. Community land trusts can be used for many types of development (including commercial and retail), but are primarily used to ensure long-term housing affordability. To do so, the trust acquires land and maintains ownership of it permanently. With prospective homeowners, it enters into a long-term, renewable lease instead of a traditional sale. When the homeowner sells, the family earns only a portion of the increased property value. The remainder is kept by the trust, preserving the affordability for future low- to moderate-income families.

NIAGARA AT LARGE Encourages You To Join The Conversation By Sharing Your Views On This Post In The Space Following The Bernie Sanders Quote Below.

“A Politician Thinks Of The Next Election. A Leader Thinks Of The Next Generation.” – Bernie Sanders

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