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Prepared for IPED Miami, Feb. 21-22, 2008 By Jaimie Ross Affordable Housing Director, 1000 Friends of Florida Affordable housing can be homeownership or rental. The primary way that housing is made affordable is through financial subsidy either in the:

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Prepared for IPED

Miami, Feb. 21-22, 2008

By Jaimie Ross

Affordable Housing Director,

1000 Friends of Florida


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Affordable housing

can be homeownership or rental.


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The primary way that housing is made affordable

is through financial subsidy either in the:

Hconstruction of rental housing, or

H in the form of gap financing for the home owner. Typically, the subsidy provided to the home buyer is recaptured upon resale.


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The Problem:

When housing prices skyrocketed, incomes remained relatively flat. Even with the housing slump, a great gap remains between housing costs and income.

*HUD FY 2002 Median Family incomes for Florida

*HUD FY 2005 CBSA-Based Median Family Incomes for Florida

*2002 & 2005 Median Existing Home Prices from the Florida Association of Realtors


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When the first time homebuyer sells what was an affordable home-- that home is no longer affordable due to market appreciation and even though the subsidy is recaptured, it is insufficient to get another family with similar income into an affordable home.

U.S. Map

One Year Change in House Prices

Second Quarter 2004 to Second Quarter 2005

Average Florida Appreciation = 24.46%

Largest U.S. House Price Increase

in MoreThan 25 years

Office of Federal Housing

Enterprise Oversight (OFHEO)

Released September 1, 2005


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Home ownership is out of reach for much of the workforce, even those with moderate or middle incomes, such as low paid professionals in high cost areas.


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Part of the Solution: even those with moderate or middle incomes, such as low paid professionals in high cost areas.

Community Land Trusts

A tool for providing home ownership

to those who would otherwise be renters or forced to leave the high cost community in which they work.


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How Does it Work? even those with moderate or middle incomes, such as low paid professionals in high cost areas.

Tax exempt nonprofit organization (CLT) deeds the improvements (the home) to the home buyer together with a 99 year ground lease for the land.

  • Two key provisions in the long term ground lease:

  • resale is limited to income eligible household;

  • resale price is limited to keep the house affordable to the next buyer (fair but not a market rate return)


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Key benefits even those with moderate or middle incomes, such as low paid professionals in high cost areas.

for the home buyer:

HPrice of the home is now affordable

HStaying in the community without being a renter means:

  • instead of rent payments, now make mortgage payments- return of equity upon resale

  • mortgage interest payments are deductible

  • financial stability-able to save without fear of rent increases or loss of housing (e.g. condo conversions)


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Key even those with moderate or middle incomes, such as low paid professionals in high cost areas.benefits for the public:

HPublic Investment is retained

HPermanent stock of affordable housing is created


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Key to the success of even those with moderate or middle incomes, such as low paid professionals in high cost areas.

Community Land Trusts is:

  • Partnership and support of the local government

  • Donation of land to the CLT

  • A highly functioning nonprofit with the ability to provide a pipeline of qualified home buyers

  • A fully informed and engaged community of prospective home buyers ; Homebuyer Counseling

  • A fully informed and engaged lending community


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The Community Land Trust even those with moderate or middle incomes, such as low paid professionals in high cost areas.

Model is a valuable tool-

  • But it is not without its challenges - e.g.

  • Design of the resale formula

    • Appreciation Formula

    • Index Formula

  • Mechanics of Resale

    • Seller Direct

    • Via CLT

  • Foreclosure

    • Restrictions Survive

    • Restrictions Do Not Survive

And perhaps the most significant challenge: ad valorem taxes.


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In Florida, we are addressing the ad valorem issue by providing statutory direction to the property appraisers to recognize the resale formula price as a land use restriction for purposes of tax assessment.


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The Florida Community Land Trust Institute is a collaboration between two statewide nonprofit organizations - 1000 Friends of Florida and the Florida Housing Coalition - for the purpose of assisting nonprofits and local governments with the development of community land trusts.

For more information contact Jaimie Ross at [email protected]

Or call the Florida Housing Coalition at 850/878/4219.


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