A home under construction is a common sight in Durham, a small but booming city in North Carolina that has been billed "the start-up capital of the South".
But this wood-frame, which will soon be a three-bedroom house, is unusual: it will rent for $800 a month, about 40 percent below the market rate.
The rent is designed to be affordable to restaurant workers and janitors, not just the new entrepreneur class. It is being built by non-profit developer Durham Community Land Trust.
"It will make some family very, very happy," said Selina Mack, the group's director.
Mack's organisation develops permanently affordable housing for working class families by separating a house's title from the land underneath.
Proponents of community land trusts say they offer the best chance of providing affordable housing in fast-growing cities like Durham compared with other popular options such as deed restrictions, which expire after a set period.
"Term-limited affordability will allow maybe one family to benefit," said Tony Pickett, executive director of Grounded Solutions Network, a non-profit housing group.
"Creating a stock of permanently affordable housing with a one-time public investment - and that same affordable housing is kept affordable for generations to come - that's a much more sustainable and financially feasible use of public dollars."
CIVIL RIGHTS ROOTS
Community land trust housing gives low-to-moderate income families the chance to become homeowners that otherwise they would never have, said Pickett.
And creating a balance "between individual wealth-building and ongoing, long-term affordability" is vital, he added, particularly given the U.S. racial wealth gap.
According to the Center for American Progress, a left-leaning think-tank, African-American families' median wealth is one-tenth that of white families - in a country where owning a home is the primary path to wealth-building.
By lowering barriers to home ownership, the community land trust model offers that opportunity.
The concept, whose roots lie in the Civil Rights movement, turns 50 this year, but rising land costs and traditional housing finance practices remain obstacles to its widespread adoption.
To date there are just 225 land trusts nationwide, according to Grounded Solutions. That is largely because mortgage bankers and realtors remain unfamiliar with the model, said Pickett, and that creates a vicious cycle.
Additionally, the relatively small number of land trusts means families looking to buy a house do not routinely have this option; that, in turn, limits land trusts' ability to accrue more equity to buy more houses.
While the house where Mack was overseeing construction last year will be rented, most trust residents own their homes.
Through an innovative housing finance model called "shared equity", the trust retains ownership of the land - and thus much of the accrued value - when the occupant sells the house.
As a result, the house can be sold at a below-market rate to the next buyer.
Comments
Post a Comment