In 2024, the population of Fort Worth officially surpassed one million people, making it the 11th largest city in the country. Population growth, along with other factors, is a major driver in the housing market imbalance in our region. The yawning affordability gap between median home prices and median wages is not expected to narrow given historical income trends. Imagine a small family with a teacher as the primary earner with an annual salary of $65,000. To purchase a home, they would need options priced around $200,000 to align with their budget. Fewer than 10% of homes on the Fort Worth market currently fit their price range (compared to ten years ago when more than 60% of homes could have matched their financial needs). Fortunately, key stakeholders in Fort Worth have been exploring innovative ideas to preserve opportunities for families at all income levels to participate in the housing market and preserve the future of community land trusts.

Two years ago, the Fort Worth Community Land Trust was formed with significant input and support from city staff and leadership, nonprofit housing experts, and philanthropic leaders, including the Rainwater Charitable Foundation. A community land trust (CLT) is a nonprofit organization that owns land and facilitates its use for community benefit, including by providing homeownership opportunities that are attainable for families earning at or near the median income. Because of a dual ownership model, CLT homes are not subject to the volatility of the speculative market.

As for the future of community land trusts, when selling a home, the CLT retains ownership of the land on which the home sits. The CLT leases the land to the homeowner through a 99-year, inheritable, renewable ground lease which conveys an exclusive right to occupy and use the land along with specific requirements, including a prescribed resale price of the home. Because CLT homeowners do not finance the land cost (and frequently benefit from additional subsidies), they agree to share their appreciated value at resale so that the same opportunity and affordable price can be made available to another household in the future. Because of the attainable entry point for ownership, strategies like CLTs can still result in a significant return on the owner’s investment. A 2019 study of shared equity housing models (including CLTs) found that homeowners received more than 7x return on their initial equity investment, showing the potential for the future of community land trusts.

Read the full article about community land trusts at Rainwater Charitable Foundation.