G.R.E.A.T and the community land trust model

How can the G.R.E.A.T Housing project say it will build “permanent affordable housing”? The crisis of affordability in Muskoka (and in fact all of Canada) is very serious. So building any affordable housing is a challenge, let alone keeping it permanently affordable. The G.R.E.A.T not-so-secret sauce for affordable housing involves using a community land trust. Community Land Trusts (CLTs) “are community led, non-profit organizations which acquire and hold land in the interest of their local community.” Sometimes CLTs work to preserve land for conservation purposes and sometimes to provide and protect affordable housing.

The CLT model is more prevalent in the U.S (with the first being “New Communities” an African American civil rights initiative) than Canada. However examples in Canada certainly exist and are growing including one of the key partners in G.R.E.A.T- the Muskoka Community Land Trust (MCLT). But how do CLT’s protect affordability? As Windsor Law Centre for Cities explains, 

Centring a human rights-based approach to housing, the goal is to remove land and housing from the real estate market through purchase or donation. The land is then held perpetually in trust to preserve the affordability of that land and housing asset. CLTs are designed to be community- and member-based entities that are legally governed by an elected board of directors. A board of directors can be comprised of lease-holders, renters, community members, public servants, governments, and/or non-profit organizations.

It is important to note that “community land trusts” are not defined in Ontario as a distinct corporation type or with a particular tax status and different CLTs take different approaches, though most are non-profits. Practically speaking a CLT owns the land and then leases property on the land. This can be rental units or units/houses that are purchased.

What creates affordability is the CLT approach of restricting what can be done with the buildings on their land. There are restrictions on the leases. For example, generally an individually owned home on CLT land has to be occupied by the owner/lease holder and the resale of any home usually has to follow a formula that restricts resale value to keep affordability. A CLT tenant may include a housing co-op where the co-op is leasing from the CLT and renting (or selling) to the members. The CLT generally restricts the rent levels to promote affordability.

For the G.R.E.A.T Housing project a Property Co-op will be created and will have a lease on land owned by the Muskoka Community Land Trust to build our first six-plex rental housing unit.  We are excited to be part of a growing movement of Canadian affordable housing initiatives using CLTs. 

Photo adapted by work by Shane Rounce on Unsplash