These new homes built on Catherine Street are introducing the land-trust model to the Carver neighborhood, through a partnership between project:HOMES and the Maggie Walker Community Land Trust. (Photo by Eastman Creative courtesy Project:Homes)
On a gray December morning, Chanel stood in front of her new house in Church Hill, the keys to her home held proudly in her hand. Not only was buying her first home a milestone for her, but the occasion also represented a landmark for the Maggie Walker Community Land Trust (MWCLT), with Chanel, who asked that her last name be withheld for professional reasons, as the first homeowner in its new model of affordable housing for Richmond.
The MWCLT was established in 2016 to provide perpetually affordable homes to low- and moderate-income families in Richmond. Here’s how it works: In coordination with other housing nonprofits, MWCLT helps to build or rehabilitate single-family homes. The land trust retains ownership of the land beneath the house so that it can be sold below market value. Each year, the homeowner pays a modest lease to the land trust, and when they eventually sell the house, the homeowner agrees to pocket only half of its appreciation value. The remaining equity stays in the house, making it affordable to the next buyer, who then agrees to the same terms — thus ensuring that the house remains affordable in perpetuity.
To qualify, a prospective buyer can earn only 50 to 115 percent of the area median income (for a family of four, that’s $61,900 to $89,000 a year) and must agree to the unique conditions of owning a land-trust home.
“We have a staggering affordable housing challenge [in Richmond],” says Laura Lafayette, chair of the MWCLT and CEO of the Richmond Association of Realtors. “Thousands of households struggle and pay way too much in housing costs.” With the federal government less committed to solving the problem and Virginia facing its own obstacles, Lafayette says a community land trust is a way not only to create affordable housing, but also to encourage inclusive wealth-building in a community.
“When you talk about a building block, what’s more foundational than creating an inclusive opportunity for families to build wealth that would never have had that opportunity otherwise?” she asks. “We all know in this country, for most people, the most significant asset that they have, the asset which allows them to leverage and build wealth, is their house. … In the Richmond region, we have generational poverty. Now we want to build generational wealth.”
Chanel had been searching for a house and was hoping to find a home in Church Hill, where she had grown up and where her grandparents had owned businesses. But prices in this booming neighborhood were out of reach. “I didn’t want to move anywhere but Church Hill,” she says. “It’s such a melting pot of diversity and different cultures.”
When her real-estate agent showed her a 1,680-square-foot, three-bedroom house that was being built by project:HOMES as the first MWCLT house, she realized she could make her dream come true. She met with Nikki D’Adamo-Damery, community coordinator for the MWCLT, who explained to her how the land trust works. “Once I heard the mission of the organization, it felt right,” Chanel says. “This house was everything I envisioned, and more.”
Bob Adams, MWCLT’s program development manager, says the trust hopes to have 10 homes in some stage of development by the end of 2018. “That’s an ambitious goal,” he says. The key to making it happen is for the land trust to be able to obtain inexpensive properties. Currently, the trust relies on a variety of sources, from direct sales of delinquent property from the city to entering into agreements with other housing nonprofits.
Because it is a nonprofit itself, it usually cannot compete when properties are put to auction, Lafayette says. The trust has purchased two properties in Barton Heights from RRHA and is working with project:HOMES to develop two properties in Carver. It also has an agreement with Habitat for Humanity, which will renovate existing homes in Randolph that will then be sold to qualified buyers with the land trust holding the land.
“We want to be in neighborhoods where you see an escalation in price values, but we also want to be in high-opportunity communities,” Lafayette says. “That means communities with good schools and access to amenities.”
MWCLT is seeking designation as the land bank for the city of Richmond, Lafayette says, with hopes that City Council will vote on it this winter. This would mean that the city would deed properties to the land bank for development. Some of the properties would go to organizations such as Habitat for Humanity or project:HOMES to be used for affordable housing. “This creates a more reliable pipeline for the CDCs [community development corporations] than if they had to go and beg the city for properties or go into the open market,” Lafayette says. These properties would also become part of the land trust to stay affordable in perpetuity. Other properties would be resold on the open market, with the proceeds used to capitalize the trust and the work of the land bank. “The trust is the governing entity,” Lafayette explains. “The bank would be a subsidiary.”
Lafayette says both the land trust and land bank are critical to creating more affordable housing in the region. “The idea that housing will be affordable in perpetuity is huge,” she says. “We have people giving money because of the idea we are leaving an imprint upon our community, a building block that is going to survive all of us. We are building something that will stand the test of time.”
*Please note that this is a projection that assumes a 4 percent annual rate of appreciation and may not reflect actual returns on equity from appreciation for CLT homeowners.
**Information from Maggie Walker Community Land Trust
