This is the last model to appear on our list of favourites. However, it is very likely that more will follow 🙂
Local community action
The purposes of the local communities that make up CLTs are varied. They may manage the construction of housing, take over properties to refurbish existing buildings, provide various types of amenity, create community facilities, build commercial buildings, etc. There are currently between 500 and 600 such Funds, mainly in the United States and the United Kingdom. In Europe they are also appearing in Belgium and France. In order to introduce you to the principles of local communities in this model, we have selected a CLT from Brussels.
Community Land Trust from Brussels
The concept is based on the idea that a member of the local community can buy a house or flat without buying land. As a result, the price is reduced by 40% compared to the market price. However, the subsequent sale of such a house is governed by special rules. This is because public funds are used to finance the project. The price of the housing must remain affordable also for future buyers. Therefore, when a resident sells their home they can do so at a price that includes what they have invested and with a small additional amount which, depending on the formula set by the CLT in question, may include a fraction of the increase in the value of their property or be based on the increase in average income in the area.
So the Brussels CLT acquires the land and then manages it. The buildings on the land are individually owned by the residents and in some cases by not-for-profit organisations. Each month the flat owner pays rent and a land rent to the CLT.
Management principles
Residents participate in project planning and management. Within the CLT they develop community projects such as after-school tutoring, various training courses and job placement. The CLT also helps them to manage their homes so that they are well maintained. Any person living in the neighbourhood can join the CLT, not just the homeowner. Each member can elect their representatives to the Administrative Council.
Typically, one-third of the administrators represent the residents, another one-third the neighbourhood residents, and the final one-third the local government. This ‘division of power’ is intended to ensure that the interests of the area’s residents and the public interest are equally taken into account.
Who can buy a house
A person can buy a home under a CLT if they are under the maximum income and do not already own another home. He or she must also have the ability to finance the purchase of the house, for example with the help of a loan from the Housing Fund. The initial deposit is €2,000.
In our view, this is an excellent model that could be used by local authorities in Poland to pursue important public objectives together with their residents, including the provision of affordable housing. We would be happy to provide more detailed information on CLT activities to interested local governments. Feel free to contact us!
