Frequently Asked Questions
What is a Community Land Trust (CLT)?
A Community Land Trust (CLT) is a nonprofit organization that acquires and holds property to provide affordable housing and community spaces. Homes are sold at below-market prices and the owners agree to pass on this savings to the next home buyer. This model ensures long-term affordability and community control.
Why do we need a Community Land Trust?
The lack of affordable housing has been a persistent and growing problem in Ann Arbor and nationally. With the ever-increasing cost of housing, many residents struggle to find affordable places to live, and are forced into long commutes.
One method of addressing this is by creating a Community Land Trust (or a CLT). Creating a CLT will not solve the deep problems that got us to this point, but we believe it can begin to address these challenges by providing a pathway to cooperative homeownership, building relationships, and financial health.
How does buying a home through a CLT differ from traditional homeownership?
When you buy a home through a CLT, you purchase the home for a below-market price and agree to pass on similar savings to the next buyer, whenever you decide to sell. This structure keeps the cost of the home lower and ensures that the home remains affordable for future buyers. You gain the benefits of homeownership while being part of a community-driven model.
Who pays the property taxes?
Because CLT homeowners enjoy the benefit of the land and the surrounding community services (schools, roads, etc.), they are responsible for paying property taxes on both the home and the land. As with all homeowners, the interest portion of your mortgage payment is tax deductible. If you itemize your federal income taxes, the property taxes that are paid are also tax deductible.
How may CLT homes be used by homeowners?
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The homeowner must only use the home for residential and related purposes.
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The homeowner must use the home as their primary residence and homestead. This means living in the home for eleven months out of the year.
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The homeowner may not use the home as a rental property. Written permission from the CLT board is required for any exceptions to this policy under exceptional circumstances.
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The homeowner must act as a good neighbor and not create any nuisances or unsafe conditions on the property.
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The homeowner must maintain the home and property in good, safe, and habitable condition and in compliance with all laws, regulations and insurance requirements.
Who is responsible for home and property maintenance?
The homeowner is responsible for maintenance and upkeep on the home and the land. As part of this responsibility, homeowners are required to see that all necessary maintenance, repairs, and replacements are performed on the home when needed. It is the homeowner’s responsibility to pay for the cost of maintenance and repairs, as well as the costs of all utilities related to the home, including water, gas, and electricity.
Can homeowners make changes to the home and the land?
Yes. The homeowner may make changes to the home, such as renovations, as long as any changes are consistent with residential use. Certain types of construction activities require prior approval from A2CLT: these are modifications that affect the footprint, square footage, or height of the home or that add new, permanent structures to the land (such as a garage).​ The homeowner is responsible for the costs of any modifications they choose to make. Homeowners may apply to have capital improvements added to the home's resale value.
What kind of support does a community land trust provide for its homeowners?
At A2CLT, we make a long-term commitment to our homeowners. Types of support offered to homeowners include education, resources and community events. Community land trusts have helped homeowners with foreclosure prevention and re-financing options. CLT homebuyers are part of a larger community – they can choose to participate in the A2CLT community through voting, volunteering or becoming a board member.
What happens if I want to sell my house?
If you decide to sell your home, A2CLT has first option to purchase it. If A2CLT does not exercise the option to purchase, you are obligated to sell the home to an income-qualified household and the resale price is limited by the resale formula in the ground lease or deed restriction and agreed upon before the purchase. The Resale Formula Price equals the home's initial sales price plus a fixed increase of 1.5% of the initial price per year. The Resale Formula Price is designed to allow the homeowner to build some equity in the home through appreciation, while ensuring the home is affordable to future buyers at resale.
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Homes purchased through A2CLT remain affordable for every new buyer. This shared equity method provides good stewardship of public funds for housing, serving the present community and future generations.
Are CLT homes inheritable by the homeowner's heirs and beneficiaries?
Yes. The homeowner can designate in their will a person(s) of their choosing to inherit the home and the Ground Lease. Anyone can inherit the home, but unless the inheritor is a child, spouse, or household member of the deceased, that new owner must be income-qualified in order to live in the home. If they are not income-qualified, then they must sell the home back to A2CLT for the Resale Formula Price. They are then entitled to keep the equity proceeds from the sale. This arrangement is designed to ensure that CLT homes are passed down to individuals and families who are in need of affordable housing. Children, spouses, and household members of the deceased are exempt from this requirement, however.
What are the benefits of selling or donating property to a CLT?
Donating or selling property to a CLT supports affordable housing and community development. You may also receive tax benefits for your charitable contribution. Your donation helps us provide more homes to those in need and supports a healthy community.
Is it legal to make buyer eligibility dependent on someone's job or income?
The Fair Housing Act prohibits discrimination in housing because of race, color, national origin, religion, sex (including gender, gender identity, sexual orientation, and sexual harassment), familial status, or disability. A2CLT will always uphold Fair Housing laws, but uses other eligibility criteria like job status or income qualification to meet community needs.
What kinds of community activities can I participate in as a CLT member?
As a CLT member, you can participate in a variety of community activities such as decision-making meetings, volunteer opportunities, workshops, social events, and sustainability initiatives. These activities help build a strong, connected community and provide opportunities for personal growth and engagement.