The Houston Community Land Trust Celebrates 100 homes
It has taken countless hours of education, advocacy, and strategic alignment with partners that understand the importance of affordability. The result has been a controversial solution that gives buyers the option to own a home, build equity, but not the land the homes sits on. In a state like Texas, land ownership can be a touchy topic, but The Houston Community Land Trust (HCLT) has now sold 100 homes using this very model and had no intention of slowing down. We recently had the opportunity to attend the 100 home celebration and the room was filled with lenders, private equity, realtors, directors and other leadership and professionals in Houston’s real estate scene looking to support Director Ashley Allen, PhD and her team on their journey. Supporters like CEO of the Houston Land Bank Christa Stoneham, Councilmember Edward Pollard, and private equity leader David Minceberg were just a few in attendance.
The HCLT provides an option that didn’t exist for those that make 80% or below of the area median income (AMI) in Houston, or $63,350 for a family of 4. With rising housing costs due to supply/demand, materials and labor, and gentrification, this option helps stabilize a segment in the market that would undoubtedly be crowded by investors both individual and institutional. To support buyers at this income level the HCLT provides a subsidy of up to $150,000 towards the purchase of any home in Houston within the buyer's purchase power. The end result is a new homeowner paying under $1000 for a home, because the land is placed in the land trust to remain affordable for 99 years. Due to the nature of the land trust, taxes are greatly reduced or eliminated and while equity growth is capped, new owners are still able to build wealth to pass on. One thing to note is that realtors are still paid full commission and builders can still expect the same profit on their developments, incentivizing everyone to at least consider this option.
Affordability is going to require numerous solutions ranging from programs, subsidy, policy and more so the land trust model is not going to be favorable for everyone. It is a platform for long-time renters and low-income earners to stabilize their living costs so that they can eventually consider upsizing or simply passing wealth on to family. Due to the success of the HCLT it is gaining popularity as a national model that we're sure we’ll see more of as costs continue to rise, especially in growing markets like Houston. We’ve been fortunate to provide support to the HCLT as well as their partners and look forward to their continued success. Visit HCLT for more info or give us a call if you’re interested in becoming a CLT homeowner.
