Posted by:
Steve Dubb
NeighborWorks, NCB Capital Impact co-sponsor symposium
This past December, a conference organized by NeighborWorks America and NCB Capital Impact, an affiliate of NCB, the National Cooperative Bank, explored ways to “scale up” shared equity housing. Additional event sponsors include: Freddie Mac, a government-sponsored housing lender enterprise, the Ford Foundation, the National Housing Conference, American Sunrise Communities (a nonprofit group established in 2006 by former HUD Secretary Henry Cisneros), and the National Community Land Trust Network.
Presentations from the Shared Equity Symposium, held in Portland, Oregon, are now available for free download. Paper topics include: a market study on the growing demand for shared equity housing, a paper on how scale up finance for community land trusts, a paper that examines the “steward” role of community land trusts (focused on how they monitor and administer land trust housing), and a paper outlining how to build policy support for shared equity.
Shared equity housing, as the conference documents show, includes a wide range of options that fall between “simple deed” homeownership (where the individual family gets 100% of the equity gain) and rental housing (where the occupant receives none of the equity gain). Common forms of shared equity housing include limited-equity cooperatives, deed-restricted housing (typically associated with inclusionary zoning), and community land trusts.
As David Abromowitz of Goulston & Storrs and Roz Greenstein of the Lincoln Institute of Land Policy note in a January 2008 Boston Globe article, land trusts and other forms of shared equity are receiving increased support due to their ability to dramatically reduce the likelihood of foreclosure. As the article’s authors point out, “National survey results show that only a fraction of homes on community land trust land have gone to foreclosure - only two in 2007 - and in dozens of cases the community land trust has intervened to head off default.”
Abromowitz and Greenstein further detail the benefits a community land trust provides: “A community land trust combines the best features of home ownership - control, predictability in mortgage costs, inheritability, and wealth creation - with protection against runaway gentrification. Ownership of the house, which stays with the occupant as in any typical homeownership situation, is split from ownership of the land underneath, which rests with the CLT. The nonprofit entity organizing a community land trust acts as land steward for the larger community, using a long-term lease of the land to the homeowner to define the basic deal. Homes can be sold at a profit, but not for a windfall, to the next generation of buyers who need an affordable house in the neighborhood.”