Community Land Trust Helps Young Single Mother Build Her Own Home
Chandra Watson has lived with her mother all of her life.
The 34-year-old single mother works full-time at a local bank and normally waits for tables next door, but that job has dried up during the pandemic. She can’t afford to rent accommodation at the moment, so she and her three children share a corner of her mother’s single-story house: Watson and the baby in one room, and her children ages 6 and 11. years in the other. She said it has been particularly difficult during the pandemic.
“It’s been a lot of time together that we’re not used to,” she said. “And there’s nowhere to quarantine. We all have to share a space.
In 2020, the fair market rent for a three bedroom was over $ 1,800, and a 2020 rental market survey placed Sitka’s average total rent higher than any other area in the state. With rental rates this high, save at to buy a house may seem like an impossible dream for many young Sitkans. When good condition starter houses go on sale, the price is often out of reach for many young professionals.
“It seems like it’s almost impossible,” Watson said. “I could never afford a $ 450,000 house that needed repairs. “
But thanks to a new affordable housing development, Watson and her children will be moving into their own home later this summer. And at $ 265,000, the price is $ 100,000 less than Sitka’s average listing price. She will pay between $ 1,300 and $ 1,400 per month for housing.
“As a young single mom, I did all of this on my own,” Watson said. “I think there was no other way in this city that I could have pursued this without this program.”
The first house in the cottage district of the S’us’ Heeni Sháak community was completed last summer, and two more are under construction. The long term goal is to build a closely spaced community of approximately 14 affordable single family homes.
A big part of what makes homes so affordable is that homeowners don’t buy the land below. This is owned by the Sitka Community Land Trust, the organization behind the housing development. A vacant lot can easily cost Sitka $ 100,000, said the organization’s co-CEO Randy Hughey.
“There isn’t a lot of land, is there? We are stuck between Tongass and the Pacific, ”he said. “It’s common in Sitka to buy land and have someone build a house, and the amount you spent on the land and the house exceeds the value of the house you create. That you are in a negative position when you are done building it.
Hughey said the lack of affordable housing has been a problem in Sitka since he moved here 30 years ago, and probably long before that.
“Every year, housing is a crisis. It’s a huge problem – availability, quality of stock, affordability. There are not enough buildings, ”said Hughey. “They cost too much and there are too many buildings that people shouldn’t be living in. “
The chalet project has been under construction for years. In 2015, the city sold the land to the Sitka Community Development Corporation, the forerunner of the Sitka Community Land Trust. The land, along with two adjacent lots that the organization still hopes to acquire, was designated for affordable housing in a 2006 referendum. They also received money from the Rasmuson Foundation, SEARHC and other donors.
The Sitka Community Development Corporation began reviewing the community land trust model in 2013. The idea is that instead of selling the land to an owner, it is placed in a trust. The owners sign 99-year renewable leases for the land and pay a small monthly fee. They also choose from a handful of designs for simple and small structures, which helps keep construction costs down. And the community land trust serves as a resource for the potential owner throughout the application and construction process.
“This in and of itself is not what will solve the problem of affordable housing in Sitka, but it is part of the problem,” said Hughey.
There are about 300 community land trusts nationwide, but Sitka’s is one of three in Alaska. The other two are in Juneau and Anchorage.
The model has been around for 50 years, but it has grown in popularity over the past decade, said Michael Brown of Burlington Associates, a community land trust consultancy.
“There is a recognition of the ability of the community land trust to ensure that housing remains affordable at all times, not just affordable to the initial occupant,” said Brown. “[That’s]… One reason there has been growth.
Affordability sticks with the house over time. If an owner decides to sell, the community land trust controls the resale and sets limits on the new purchase price. This can be a drawback for the homeowner, as they likely won’t get as much for the house as they do on the open market. But they will get all the money they put in it and more.
For the Sitka model, this represents 25% of any increase in appraised value. For example, if the owner buys one of the cottages for $ 200,000, and when he wants to sell it, it is valued at $ 300,000, he gets the money that he put into it plus $ 25,000. The Sitka Community Land Trust then sells the house to a new buyer for $ 225,000, which is less than its appraised value.
“I want to be very clear that community land trusts do not challenge individual property rights. What we’re really trying to do is help provide access to people who are excluded because of market conditions and household incomes. These are issues beyond their control, ”said Brown.
Brown helped Sitka set up their community land trust, which was officially founded in 2016. He said each community’s model is unique.
“There is a C in the CLT. It’s about community organizations… It’s not just about providing affordable housing. It’s about being good stewards of the land. It’s about creating affordable housing, but it’s also about making sure that services and resources are available to the people who live in the housing, ”said Brown. “It’s not about managing their lives, but about making sure that we are doing everything we can to help increase the likelihood that people will be successful over time, helping them make successful transitions when it is. the good moment.”
The price of the cottages is not accessible to all. In general, people have to do at least 80 percent of the region’s median income to pay the payments. It’s about $ 60,000 for a couple. And even then, many don’t have enough savings for a down payment, especially since the cost of living in Sitka is so high, said Co-Executive Director Mim McConnell.
“We’re trying to get home prices down enough that people can afford a mortgage. And we find it difficult. We would like home prices to be lower than they are, ”McConnell said.
She said opening up additional financing options, like rural development or VA loans, could help. For now, their target audience is young professionals looking for a starting home, which McConnell says is not uncommon for a community land trust.
“And our community needs these people,” McConnell said. “I mean, the police, the fire department, the nurses, the teachers – they’re all very important parts of our community and if they can’t afford to live here, we’re in trouble.
It’s not just the cottages that the Sitka CLT works on. They also thought about developing individual houses as the land becomes available or is donated to the organization. And they thought about working in other communities in the Southeast, like Tenakee Springs.
The Sitka Community Land Trust faces some hurdles. They have yet to acquire two more plots in the city, which a 2006 referendum designated for affordable housing. And they had to temporarily halt construction of all the additional houses because the pandemic has skyrocketed the cost of materials, making house prices both unpredictable and unaffordable.
And even for pre-pandemic homebuyers like Watson, the price is still high: she will spend about half of her income on housing costs. But she said, it’s worth having your own house. His son Cameron, 6, said he couldn’t wait to paint his own bedroom.
“My mind is like running around with all of these different things that I can do with the house to design it, how to decorate it, how many new memories, experiences and traditions that the kids and I can put here,” Watson said. “I am so excited to have this new beginning with them.”
After having her third child last year, she thought about moving to a more affordable place. But now, she said, she’s staying for good. This is where her family and support networks are located.
It’s my house.
Throughout April and May, Raven News will bring you articles on affordable housing solutions every Friday as part of our “Building Solutions” series. Erin McKinstry is a member of the Report for America Corps.