What is a CLT?
A community land trust (CLT) is an innovative real estate ownership model.
It reduces housing costs by roughly one-third and ensures perpetually affordable homes.
By separating the ownership of land and housing, CLTs create long-term community stability and support sustainable development.
How the Sitka CLT Works
A community land trust can reduce the cost of homes through a number of mechanisms: acquiring land at reduced cost via public subsidy, building small homes in a well planned neighborhood, selling only the home and not the land to the homeowner, and capping the amount of appreciation that an owner can profit from on resale.
A CLT acquires land and builds small homes. The deed of the home is separated from the deed of the land and the homeowner buys the home but leases the land, typically on a 99-year lease. The CLT retains the land, and the owners purchase only the home.
When purchasing a home, owners sign an agreement that, among other things, limits their profit taking at the resale of the house to 25% of the change in appraised value. This limitation is necessary because property values tend to increase over time substantially more than wages. This limit on profit-taking keeps the home perpetually affordable while allowing the owners to accrue enough equity to enter the open housing market during their next home purchase and to preserve affordability over time.
Permanently Affordable Housing
This cycle ensures homes in the Sitka Community Land Trust remain affordable for future generations.
Frequently Asked Questions
When a Sitka CLT home is initially sold, the land and the improvements are separated. As a homebuyer, you purchase and own the home and all improvements. The SCLT retains ownership of the land and leases it to you for 99 years (and you can pass it along to your children and it can be renewed for an additional 99-year term.)
Benefits of Purchasing an SLCT Home
Who We Serve
SCLT restricts its permanently affordable housing to households with incomes below 120% of Sitka median income, adjusted for family size, as well as households that are, by federal definition, “low-income” – i.e., households with incomes below 80% AMI – consistent with our IRS designation as a tax-exempt, “charitable” organization.
We encourage prospective homebuyers who make less than 80% AMI to check with a lender to see if they may qualify for a home mortgage loan. This is a simple process that does not take much time or effort.
Our goal is to provide affordable homeownership. The sales price must be affordable to the new purchaser, that is, loan payments of principal and interest, taxes and insurance, generally called PITI), or all housing expenses (including PITI, land lease or dues, utility expenses, and a reasonable maintenance reserve) do not exceed 41 percent of the new purchaser’s income. For the up-to-date HUD income limits that SCLT uses, please download our SCLT Qualifications and Housing Application below.
Have questions?
Want more information?
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Email us at contact@sitkaclt.org or fill out the contact form.
