Shared equity homeownership is a housing choice that falls in between rental housing and traditional homeownership. Shared equity homeownership offers a safer and more sustainable approach to affordable homeownership that provides a meaningful alternative to the risky sub-prime financing that contributed to the foreclosure crisis. Learn more…
Shared equity homeownership is a general approach to assisting homebuyers which can be implemented through a number of quite different legal or organizational structures including:
- Community Land Trusts
- Deed Restrictions/Covenants
- Limited Equity Cooperatives
- Shared Appreciation Loans
Shared equity homeownership has been growing in popularity because, compared with other approaches to affordable homeownership, these models do a better job of balancing a number of key community goals.
- Shared equity homeownership provides a way to preserve affordability of publically assisted homeownership opportunities so that they can serve one generation of homeowners after another.
- At the same time, shared equity homeowners are generally able to build meaningful wealth, making this form of ownership one of the most promising asset building strategies available to lower income households.
- By offering residents a real economic stake in housing but preserving affordability, shared equity homeownership offers a tool for revitalizing distressed neighborhoods without contributing to displacement.
- In fact, many cities and counties and several states are employing shared equity homeownership programs as part of their response to the foreclosure crisis. They are buying vacant properties and restoring them to use today while protecting affordability for the future when a market recovery will inevitably push prices once again out of reach.
- In other communities, shared equity homeownership is being used as a tool for maintaining mixed income communities as smart growth and transit oriented development policies bring higher income residents and commercial development back to long neglected urban areas.
This site has been designed to provide an introduction to this new approach and an overview of how local communities are incorporating shared equity homeownership into their affordable housing strategies. We have collected a select number of introductory resources with an emphasis on the needs of several key groups of housing professionals including:
- Survey: Community land trusts lower risk of losing homes to foreclosure
- Commercial Mortgage Insight: Shared Equity Gains Acceptance
Homeowners in community land trusts (CLTs) across the country are much less likely to lose their homes to foreclosure than owners of market-rate homes, according to survey results released by the National CLT Network and the Lincoln Institute of Land Policy. The new data show 2008 closing with a slight 0.52 percent foreclosure rate among […]
This article from Commercial Mortgage Insight explains how mortgage brokers and lenders can participate in the growing trend toward shared equity homeownership. The greatest benefit of shared-equity ownership is that it presents the opportunity to both generate substantial wealth for individuals and allow communities to create a stock of permanently affordable ownership housing. Historically, the only housing options available have been renting or traditional homeownership, where the buyer reaps all the rewards of ownership, but also bears all of the burdens. More often than not, those burdens are too great for low- to moderate-income individuals.
- American Planning Association: Affordable Forever
- Washington Post: Shared Equity Homeownership in DC
This article from Planning Magazine profiles a number of community land trusts and describes how local planners are turning to CLTs as a means for preserving long term affordability of homeownership units.
While there is plenty of blame to go around for this mess, the goal of expanding homeownership is still an important one and should not be sacrificed. It can be done responsibly and should remain a priority. In fact, one of the best examples of how it can be done is right here in the District.