The Impact of Community Land Trusts on Neighborhoods

Over the past year, Community Land Trusts (CLTs) have become a focal point of the affordable housing movement in New York City, and recent City support and funding for the alternative homeownership model signals an embrace of CLTs as a policy tool for greater affordability. New York City is already home to a few CLTs and affiliated networks, but steps have recently been taken to incorporate this model into a scalable policy strategy: the creation of the first City-sponsored, citywide CLT was announced in October 2017, and the City Council has since passed legislation that codified CLTs into city law.

What is a CLT?

A CLT is a real estate ownership model that separates landownership from homeownership or ownership of property for other uses. Under this model, a community-controlled nonprofit owns the land, and individual property owners possess the housing, or other assets like green space or retail, sitting on top of that land. CLTs keep land out of the speculative real estate market and limit the resale or rental value of the assets on top with the goal of preserving affordability over time. CLTs are also democratic, community-building tools—in addition to increasing occupant housing tenure through long-term affordability, CLTs are typically managed by a board of directors that includes homeowners and local community members.

Though land trusts are rooted in the philosophy of economist Henry George, the first modern CLT came out of the Civil Rights movement. Civil rights activists in Georgia founded New Communities Inc. as an agricultural and residential cooperative in order to build economic self-sufficiency within the black community, after being denied opportunities by white property owners resisting desegregation. There are now roughly 225 active CLTs across the United States.

What impacts can CLTs have on neighborhoods?

Research has already demonstrated the financially-stabilizing effects CLTs can have at the owner-occupant level, but a September 2017 study is the first to look at the broader stabilizing effects that CLTs can have at the neighborhood scale, and on gentrification specifically. The study, published by researchers from Texas A&M University, shows a relationship between CLTs and the prevention of typical negative effects of gentrification—defined for the purposes of the study as displacement through class turnover, decreasing affordability, and skyrocketing property prices. The researchers’ quantitative analysis compares gentrifying and non-gentrifying neighborhoods with and without CLTs over time according to racial composition, class composition, median income, educational attainment, resident tenure, age fluctuation, housing affordability, owner-occupied housing rates, and property values. Ultimately, the results suggest that the presence of CLTs in gentrifying neighborhoods might counteract the negative effects by increasing racial diversity, increasing affordability, maintaining the middle-class population, stabilizing median income levels, maintaining levels of educational attainment, and stabilizing housing prices.

While these results are promising, housing experts warn that CLTs alone cannot sufficiently counter the impacts of real estate speculation at the city scale. As policymakers consider how to integrate the CLT model into New York City’s affordable housing strategy, they should see it as just one piece of a broader movement to address New York City’s affordability crisis.