How Community Land Trusts can solve the London housing crisis

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How Community Land Trusts can solve the London housing crisis

July 2007

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London Citizens is the capital’s largest and most diverse alliance of active citizens and community leaders organising for change.

Members include faith groups, schools, student organisations, union branches and residents groups who share a commitment to action for the common good, and to nurturing leaders from all backgrounds.

The London Citizens community includes West London Citizens, South London Citizens, TELCO East London Citizens, and the Citizen Organising Foundation.

www.londoncitizens.org.uk 0207 375 1658

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Introduction

Housing policy will play a key role in London’s future. In order to maintain London’s economic success Londoners must have access to adequate and decent housing conditions, yet the demand for housing has outstripped supply for years.

The cost of housing in London has increased exponentially in recent years even in the poorest boroughs in East London. The average cost of a home is now just under

£350,000¹ (well above the £200,415 average for the remainder of the country).

The number of households living in overcrowded and temporary accommodation is a major concern.

LONDON CITIZENS, the capital’s largest alliance of civic and faith organisations, is working in partnership with CDS Cooperatives, the largest co-operative housing service agency in London and the South of England, in order to create the first Community Land Trust for Mutual Home Ownership in London. LONDON CITIZENS has registered with the Financial Services Authority (FSA) the first Community Land Trust in London (East London Citizens CLT Ltd).

Between 1700 and 1850 Parliament passed 3,400 Acts of Enclosure and this meant that all but about 8% of land in the UK was lost to the public. Community Land Trusts (CLT’s) were first proposed by Thomas Spence in 1775 in ‘The Rights of Man’ as a project for land reform. Spence proposed trust companies with democratically elected boards to steward and develop the commons in each parish to suit local needs. Spence argued that freedom for people requires equal access to ‘the common land’. This campaign was picked up by The Chartists in the 1840’s and was one of their key demands.

How does a Community Land Trust for Mutual Home Ownership work?

• Land is given to the Land Trust. It is safeguarded by the Trust and remains in democratic public ownership in perpetuity

• Thus the cost of land is removed from the price of housing (in London the cost of land represents roughly 60% of the total cost).

1 Source : GLA economics 2007

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Introduction

• The housing is managed by a Housing Cooperative on a Mutual Home Ownership basis.

• Homes on a Community Land Trust are initially sold to first time homebuyers subject to certain controls over their occupancy and resale (in order to “lock in” the land subsidy and ensure affordability for future generations.)

The CLT model overcomes problems with other affordable housing schemes.

• It is ownership rather than rent orientated so low-income families accumulate an exchangeable asset over time.

• The subsidy is locked into the land which cannot be sold on the open market, only back to the housing cooperative. This keeps the benefit available to the local communities.

In April 2004 LONDON CITIZENS held a major Accountability Assembly for the four main candidates standing for election as Mayor of London in May 2004. It was the biggest event of the election and attended by over 1800 members. One of the four commitments that each candidate was asked to give was to work with LONDON CITIZENS to pilot the capital’s first COMMUNITY LAND TRUST (CLT) for Mutual Home Ownership – and together build 2000 affordable family homes. Since that time Mayor Livingstone has paid for two feasibility studies into the proposed scheme. He has asked for a pilot scheme in East London of 100 units to ensure ‘the model’ is workable. Both of the feasibility schemes said it was and CLTs are very popular in the USA and Scandinavia.

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Introduction

In July 2007 the GLA has given to London Citizens a precise timetable and name of site for this pilot. The planning application is likely to be submitted by September 2008 and the building on the site will begin in 2009. The pilot should be ready for occupation by 2011.

LONDON CITIZENS believes CLTs are the answer to London's spiralling housing crisis. In the following pages, we explain why.

LONDON CITIZENS has a proud history...

Through its Living Wage campaign, London Citizens made the case for a decent wage for London's workers, an idea adopted by London's mayor and increasingly adopted by businesses and universities in the capital.

Through the Strangers into Citizens campaign, we have made the case for a pathway into citizenship for long-term migrants in the UK, a case now being studied as never before.

Situations of the households interested in this scheme

LONDON CITIZENS has built a list of potential buyers and conducted a survey among them. The results of this survey will illustrate this report. Here is the presentation of the sample (110 households)

.

• Most of them are renting a flat/house

Current housing situation

renting from a private landlord renting a

council flat lease holder

living with parents

other

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Introduction

• Most of them have been looking for better housing for more than 5 years.

How long have they been looking for better housing?

0 5 10 15 20 25 30 35

never before less than 1 year

from1 to 2 years

from 2 to 5 years

more than 5 years

%

In Tower Hamlets Housing services we have been told that the average wait for a one bedroom flat was from 5 to 10 years, from 7 to 10 years for a two bedroom flat and more than ten years for a bigger flat.

• This scheme is designed for people earning between £12,000 and £30,000 who are not wealthy enough to buy a property on the open market yet not poor enough to benefit from social housing. Here are the incomes of the potential buyers. They are mixed and match with the target the scheme is focusing at.

Household income

less than

£12,000 a year

between

£12,000 and

£14,000 a year

between

£14,000 and

£17,000 a year

between

£17,000 and

£21,000 a year between

£25,000 and

£30,000 a year

no answer

between

£21,000 and

£25,000 a year more than

£30,000 a year

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Introduction

Introduction to the following sections

The following sections will focus on the reasons why people might want to change homes, why they might like to buy a house and how Community Land Trusts are able to fulfil their needs and aspirations.

Why do they want to move house ?

better environment

overcrowding community life invest for the future buy rather than rent

0 10 20 30 40 50 60

%

o 47% of the households say they want to move house because they are currently overcrowded. In the first section we are going to focus on this theme.

o 58% would like to move home to live in a better environment and 1 out to 3 households are interested in the Community Land Trust Scheme because they want to improve their community life. Therefore, on the second section we will give details about their aspirations and see how it matches what a Community Land Trust offers.

o 57% want to move house because they want to buy rather than rent. (43% are using the term “invest in the future”). This is an important issue we are going to tackle in the third section.

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Section 1 : Overcrowding

Section 1: Overcrowding

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Background

The legal definition of overcrowding dates from 1935³. According to this definition a family of four with two children under 10 living in a one-bedroom flat would not be considered overcrowded.

In 2003 a bill⁴ was introduced to change this definition to:

For the purposes of the Bedroom Standard a separate bedroom shall be allocated to the following persons:

(a) a person living together with another as husband and wife (whether that other person is of the same sex or the opposite sex)

(b) a person aged 21 years or more

(c) two persons of the same sex aged 10 years to 20 years

(d) two persons (whether of the same sex or not) aged less than 10 years

(e) two persons of the same sex where one person is aged between 10 years and 20 years and the other is aged less than 10 years

(f) any person aged under 21 years in any case where he or she cannot be paired with another occupier of the dwelling so as to fall within (c), (d) or (e) above.

Originating in Government social research surveys of the 1960s, the Bedroom Standard has been used in ODPM housing surveys for the last ten years⁵. Ministers have decided against using the 2003 Housing Bill to update the overcrowding standards. The Government had concerns about introducing a measure based on the bedroom standard as, in contrast to only 48,000⁵ households breaching the existing

2 This cartoon originally ran on the editorial page of the 2/20/81 issue of The Phoenix.

3 Kitchens and living rooms are counted as available sleeping accommodation, children under 10 years old are counted as half a person and those under one are not counted at all. Children over 10 of different sexes need separate rooms and married couples can be expected to sleep apart if that is the only way this requirement can be met.

4 From the Housing (Overcrowding) Bill, as introduced in the House of Commons on 22nd February 2003.

5 ODPM, Overcrowding in England 2000-2003, April 2004

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standard, applying the bedroom standard increases the number of overcrowded households to over 500,000⁵ in England.

Facts

General

• Even with the current limited definition of overcrowding, government figures show that more than 20,000⁵ families currently live in overcrowded accommodation, with concentrations in London in both social and private rented accommodation.

• The real problem of overcrowding however is far greater if other definitions of overcrowding such as the Bedroom Standard are used. By this definition, as many as 175,000⁵ families in London are suffering the misery of living in overcrowded accommodation.

• More than 260,000 children in London live in homes without enough bedrooms. In some parts of London as many as one household in four is overcrowded⁵.

• In London, one in every seven (13.8 per cent) families with children is overcrowded⁶.

• 12 per cent of white British households, 35 per cent of black and minority ethnic households and 62 per cent of Bangladeshi households in London are overcrowded⁷.

• Severe overcrowding in London increased by 60 per cent between the 1991 and 2001 censuses.

• In 2004 a government review concluded that there were strong links between overcrowding and particular health conditions, in both children and adults;

including respiratory conditions, meningitis and helicobacter pylori which is a cause of stomach ulcers⁸.

• The stress of sharing bedrooms and inadequate cooking, cleaning, and toilet facilities is well documented as a cause of tension between family members in overcrowded homes. In some circumstances, it can lead to a breakdown in family relationships and to homelessness for older ‘children’.

5 ODPM, Overcrowding in England 2000-2003, April 2004

6 Source : Shelter

7 Census 2001 © Crown Copyright

8 The Impact of Overcrowding on Health and Education, A Review of evidence and Literature, ODPM, May 2004 (Centre for Comparative Housing Research and the Health Policy Research Unit, De Montfort University)

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• The lack of privacy is a major concern for adults⁹, but can be a particular problem for teenage girls sharing bedrooms with brothers or older male relatives.

• Disturbed sleep patterns can be a particular problem for people having to sleep in communal rooms¹⁰.

• Living in cramped conditions can also affect children’s educational attainment.

A French study showed that ‘children who grow up in a home with at least two children per bedroom are both held back and drop out of school before earning a diploma much more often than other children¹¹.

Number of households on housing register for 3+ bedroom property .v. number of newly constructed social housing 3+ bedrooms - England 2003¹²

There is a big gap between demand and supply of family houses. This chart above illustrates this point. Planning strategies should consider the huge need for family houses.

• In London, an estimated 12,000 homes with five or more bedrooms are needed to deal with overcrowding in the housing association sector alone¹³.

• In the council flat sector we have been told that there was a huge lack of three or more bedrooms flats (people were on the waiting list for lore than 10 years) and there has been no increase in building of family homes.

9 Elaine Kempson, Overcrowding in Bangladeshi households – A case study of Tower Hamlets, Policy Studies Institute, 1999

10 Elaine Kempson, Overcrowding in Bangladeshi households – A case study of Tower Hamlets, Policy Studies Institute, 1999

11 Dominique Goux and Eric Maurin, The effects of overcrowded housing on children’s performance at school, Paris, Centre for Economic Policy Research, March 2003

12 ODPM house-building statistics, 2003/04, table 252, ODPM HIP HSSA 2003.

13 NHF survey of housing association transfer lists

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Focused survey

Overcrowding?

0 2 4 6 8 10 12

members of the household actual number of bedrooms

In the chart above we can compare, for each household, the number of bedrooms with the number of members in the household. In some cases the gap is wide but one can argue that in a household each member doesn’t have to have his own bedroom. This is why we have compared in the chart below the number of existing bedrooms with the number of bedrooms recommended by the Bedroom Standard introduced in the first paragraph of this section. We may add that this Bedroom Standard is considerably below what most families would nowadays consider the minimum.

Indeed it is quite clear that two youngsters of the same gender aged between 15 and 21 would like to have their own bedrooms for instance. This is what the families we spoke to clearly want.

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How many bedrooms should each household have according to the

"Bedroom Standard" ?

0 1 2 3 4 5 6 7 8 9 10

1 households

number of bedrooms

number of bedrooms recommended by the "Bedroom Standard"

actual number of bedrooms The household number 49 is living in a 3 bedrooms flat whereas whith the Bedroom standard they should have 5

bedrooms.

The yellow area clearly illustrates the gap between actual situation of households and the 1960s Bedroom Standard.

Testimonies

We have encountered many feelings of desperation and frustration in our one to one meetings.

“Look at these kids, we are so cramped, there is no room, look how we are overcrowded. My son is 14 years now and he is still with the girls (13, 8, 6) in a very small room. I was thinking to take them to court now…I am going to get a lawyer, because nobody is

listening to me now. He is big enough to get his own room. So it is why I am so determined to get a new place, for them.”

Inewari from Plaistow

Photo 1 Inewari's 4 children in their small bedroom

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“I live in a two bedroom flat and it is not big enough for us because we have 4 children, we bought the property from the council (right to buy) and even if we sell it now, with the excess money left away it’s still impossible to buy a house with our income and with the size that we need. There are lots of people overcrowded. I work in a school and all the girls who talk to me… It the same issue they are overcrowded.

I know one who is living with six kids in a two bedrooms flat! And during the holidays they are all stuck in this flat, they must go insane…”

Rena from Limehouse

photo 2 Rena and her family, below are the two bedrooms in which they are living.

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“Since 2001, I have been living here with my wife and 4 children, the elder one he is 17. My daughter is 14. Son is 11. Younger daughter is 8. We have two bedrooms.

The 4 children are in the same bedroom.

I am still waiting for a better house. Because here, it is not enough. My daughter, she cannot work, you know her homework… My son neither. And the too younger are shy you understand? They don’t like face to face, they are shy. And also it is difficult to sleep.”

Saidani from Shadwell

“I am really interested by this project for myself as well as for others. Indeed as a school teacher I experience the bad consequences of overcrowding every day. I’ve got pupils who don’t get proper sleep, they are unstable toward the end of the day and can’t concentrate because they live in cramped conditions (3 or 4 children in a bedroom). They are down, introverted, not bubbly and cry easily. Some of them are living in shared accommodation, others in temporary housing in which case they face huge instability moving from flat to flat.”

Alison, Newham

Conclusion

⇒ CLT will be able to deliver more family houses as they will focus on delivering adequate housing for the communities.

⇒ Less overcrowding will improve living condition, education of the children, well being and thus enhance the quality of community life.

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Section 2 : Live in a better environment with a real community life

London is a city of contrasts. Inner London is by far the wealthiest area of the European Union but extremes of wealth and success and deprivation and social exclusion exist side by side. A real community life and a good housing environment can help prevent social exclusion. Social exclusion happens when people or places suffer from a series of problems such as unemployment, discrimination, poor skills, low incomes, poor housing, high crime, ill health and family breakdown. When such problems combine they can create a vicious cycle.

The Quirk Review and other research commissioned by the Department of Communities and Local Government (DCLG) reveal a growing recognition of the fact that community ownership of assets encourages social enterprise and active citizenship.

“Owning an asset can give individuals greater confidence to plan for their future.

There are clear benefits to local groups owning or managing community assets – such as village halls, community centres, building preservation trusts and community enterprises.

Community ownership can bring people from different backgrounds together. It can foster a sense of belonging. It can play a role in enhancing the local environment, alleviating poverty and raising people’s aspirations. Fundamentally, it’s about giving local people a bigger stake in the future of their area.”

Rt Hon Ruth Kelly MP Secretary of State for Communities and Local Government in her introduction of the Quirk Review of community management and ownership of public assets (2007)

“The Mayor’s desire to increase the supply of homes in London is matched by his determination to make sure that new homes are of a high quality and meet Londoners’ diverse needs. The Mayor’s Housing Strategy will therefore attach great importance to the issue of design, both of

buildings and the public spaces that surround them.”

From Towards the Mayor’s Housing Strategy (November 2006).

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Testimonies

“In my tower block there is a little park but, there is always glass, needles, I don’t take my children downstairs to the park because I don’t feel very safe. I don’t open my door after 6 O’clock. Here there is a lot of people taking drugs in the stairs.”

“Looking after that is what it is about, here nobody look after, people from outside are messing up the park, they break the swings…”

“I don’t mind living with persons from different communities as soon as it is a peace way to live, a nice way to live; obviously we are all from different countries, with different religions, my neighbour is from Jamaica, and I’ve got friends who are English as well. You have to take interest in the different cultures.”

Anwara from Stepney Green

“I just want to be in an environment that is quite friendly because when you live in London you don’t know your neighbours, that’s the fact. I don’t know the people that live next door to me, it would be nice to have that communal feeling and to know who your neighbours are, to have a good atmosphere, to know that you are living in an environment which is safe and, somewhere where you just feel

comfortable.”

“I don’t mind living with people from different communities, I work with people from different communities that’s part of living in London I mean, you have to mix inside because a lot of communities want to stay within themselves and not a lot

communities are willing to mix. But you can’t have that sort of mentality and live in London, you have to really be involved with everyone because at the end of the day it’s just living in London and you can’t ignore people because of their faith or their skin colour, it’s just ridiculous!”

Husna from Mile End

“Acceptable housing is communities where you know most of the people with whom you live around. Acceptable housing is when the neighbourhood takes control of the neighbourhood. And by now what we see is people buy new places, very short term, wait for the price to go up and then they move. There is no stability in the

community; there is no trust in the community. Parents are too scared to take their children outside because they don’t know their neighbours; they don’t try to develop a relationship with their neighbours.”

“In an ideal community you are respected as a citizen and as a human being and you are not valued because of the price of the accommodation where you live in. I don’t want my child to be disadvantaged because we are not rich enough to be in a good community where they can get a good education, good healthcare. That should be for every body.”

Kevin from South London

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“The house we live in now is in a cooperative and obviously I want to manage with the community and we have always participated. On Sundays the kids are in the common place playing in the room, we don’t have the choice basically sharing and playing and meeting up so we have connected and have a lot of learning about each other neighbours and just making a more pleasant environment. We have done a lot in terms of making…well where we’re living has become a very nice place to live in.

We talk to each other, we have events with all the community together, the youth have activities to do, the older look after the younger…Obviously, a real community life is part of my expectations for my next house because we are overcrowded in this one.”

Alice from Limehouse

Conclusion

⇒ We must not repeat the mistakes of the past - all housing needs to be of high quality, in mixed communities, with local services developed alongside and sensitive to the environment.

⇒ We have to maintain affordability, prevent social polarisation and promote sustainable communities.

⇒ Community Land Trusts in the past have succeeded in providing community control and ownership of local assets including land and property

⇒ Thanks to CLTs we will manage these assets to enhance the social inclusivity, economic well-being and sustainability of the community.

⇒ CLTs will collectively preserve and increase the wealth and cohesion of the community by increasing access to affordable land, property and housing.

⇒ With CLTs local communities have a focus for involvement and control of the decisions taken in their locality. Resident involvement, local governance and active citizenship are all increased.

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Section 3 : Renting nightmare versus house price crisis

Section 3: Renting nightmare versus house price crisis

Renting nightmare

• At present council house waiting lists stand at just over 1.6 million. But new research by Shelter shows this figure could be inflated by 400,000 to more than two million by 2010.¹⁴

• By 2026, London is expected to be home to up to 720,000 more households than in 2006.¹⁵

• Mobility within the Private Rented Sector was much the highest of all tenures.

The proportion of UK private renting households living at the same address as one year before the 2001 census was 58%, indicating a high level of ‘churning’

within the sector. This proportion compares with 86.3% of all UK households in all tenures¹⁶.

Testimonies

“At the moment I am sharing a one bedroom flat with its owner. He is sleeping in the living room. Everybody has his own privacy. He is a good friend but you know

sometimes he wants me to pay more than 80 pounds a week. It depends. And if you say no, he says you are gonna leave his house and it is gonna take you time to find another place where to stay. But it is not stable. It is not easy, it is very tough.”

Michael from East London

14 Source: Shelter

15 Towards the Mayor’s Housing Strategy (GLA, November 2006).

16 https://www.jrf.org.uk

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“At the moment I live with the landlord. The problem is that I am paying his

mortgage. It is money down the drain. I have lived there for just over two years now.

But before that I moved three times a year. Because every time I was somewhere the landlord like to sell or… So I want to buy somewhere so that I could have security and also I want to think, even if I don’t make money I don’t want to throw money away neither!”

Mervyn from Hackney

“I am currently living in a very bad area. But you know before I was homeless, so they give me this flat and I had no choices. Basically you can choose between two flats but for homeless people you have no choice. I used to live with the parents of my children’s father. So they give me this flat, but you know the area where I was living before, it was also in Tower Hamlet and it was even worse!”

Anwara from Stepney Green

House price crisis

In most areas of southern England from London to Exeter, 2002 was the first year in which housing cost more than the average annual pay of people working in public services. Soaring mortgage costs for first-time buyers have been exacerbated in the South of England by a disproportionate gap between housing supply and housing demand in both homeowner and rented sectors. Those worst affected are workers on average incomes who are neither poor enough to rent from a social landlord nor rich enough to rent or buy in the open market.

The charts below illustrate the disproportion between average incomes and average house prices as well as the increase of the average of the first time buyer deposit. As a consequence the third chart shows that first time buyers are less and less able to access the property market.

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• While salaries in London have increased by 26 per cent since 1997, house prices have increased by 127 per cent¹⁷.

• 30 per cent of Londoners gave housing as their number one reason for wanting to leave the capital¹⁸.

• 72 per cent of London businesses think that lack of suitable housing is a barrier to recruiting and retaining staff¹⁹.

• The average deposit for a first time buyer in London is £51,800.²⁰

• Those who have houses may choose to help their children get one too. Over 40% of first-time buyers now receive help from their parents, according to the Council of Mortgage Lenders. But children whose parents do not own homes will be left behind.

• The price of land represents roughly 60% of the price of a house; with a Community Land Trust the price of the land is taken away from the house price.

17Sources: ASHE, Land Registry

18 Sources: MORI London survey 2001/GLA taken from London Housing Strategy draft evidence base

19 Sources: CBI London Business Survey April 2005

20 Department of Communities and Local Government, 2006

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Testimonies

“Myself and my partner, we are both school teachers and we’re at the moment renting our flat and this is 750 pounds a month. It used to be social housing flat which has been sold so now it is a private landlord. We went to see a financial adviser but we don’t have enough money saved to buy a house; also they said the amount of money we earn wouldn’t be enough to buy a house. But it’s funny because we rent right now and it is only a little bit less than what the mortgage would be. So we can afford a mortgage but they don’t want to lend us the money.”

“I have read that you know “buy to let” has increased by 25% in the last ten years.

The problem is if you buy a place to rent to me. My rent is paying your mortgage. So you are never going to be able to be on the housing market because it is too

expensive.”

Kevin from South London

“My husband is retired, I am the only one who is working, I have got two jobs but it is really difficult to buy a house and I will be retiring in three years time and until now we haven’t bought a house. We are renting renting…

We looked for other affordable scheme such as Shared Ownership but for a two bedroom house it was £261,000 plus £400 rent by month so £1,200 monthly (mortgage plus rent); it is too big, it is too expensive, all my money would go and we will have nothing left to eat.”

Adelaida from Canning Town

“The opportunity of creating a Community Land Trust is there and if we do get the permission to go ahead it would do a huge favour. I definitely would be interested in this scheme because it’s an opportunity for me to not only get on to the housing market but to secure my future so I know that I got something there that is permanent rather than renting a house.”

“If you don’t have opportunities, people tend to look elsewhere and start to look for housing outside of London just where they can actually. A lot of people won’t be able to do anything unless they get a huge help because of their financial situation and their housing situations.”

Husna from Mile End

“One of the problems I have is that I am competing like every one for houses and it is not a level plain field so, I read the other day that 55% of new developments were bought by “buy to let”, the reasons for that are, on one hand they have equity, they have capital to use to buy the flats and I don’t, so I am competing against them on that basis, and the other hand they get tax release for “buy to let” and first time buyer don’t get tax release, so there is no way we can compete. If you don’t have rich

parents or initial capital you are stuck, because even if you have savings, you are looking for 5, 6 times your income if your lucky…”

Mervyn from Hackney

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Conclusion

⇒ CLT seek to capture subsidy value, thus preventing value leaking out of the area or into private hands, and helping to insulate the community from the disruptive effects of the property market. The land price is taken away from the house price and house price control is taken away from the open market. Houses in a CLT won’t suffer from house price crisis.

⇒ With CLTs, affordable housing is provided for local people for potentially both rental and low cost ownership and affordability is preserved for future generations.

⇒ Buying a house in a CLT enables the occupier to gain a foot on the housing ladder.

⇒ CLTs will add flexibility and humanity to the housing market.

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Epilogue

Support of Community Land Trust Model in government policy documents

The Government’s housing green paper ‘Homes for the future: more affordable, more sustainable’(July 2007) supports the piloting of 14 CLTs across the country. It is said that “Community Land Trusts can now bid for Housing Corporation funds to build new homes”.

The ‘Report of the Shared Equity Task Force’ published by HM Treasury Dec 2006 contains the following Government policy commitment:

“One style of this land model involves provision of homes that can never be purchased outright (‘affordable in perpetuity’) and are generally provided by not-for- profit organisations.

The main example of this is a Community Land Trust that owns or controls land, housing and other facilities for the benefit of the community. Under this broad banner there is a range of possible models and arrangements. It is common to have a high level of community involvement and to restrict homes to people with a local connection, and there may or may not be a partnership with a housing association or other organisation. The main feature is that the Trust keeps permanent ownership of the land and rights over the home, so that although the ‘shared owner’ buys a share of the home, they may not buy it outright and must sell their share at a fixed (low) price when they move via the Trust.”

“The Government believes that Community Land Trusts have the potential to empower communities and provide additional affordable homes, and they may be a useful part of a ‘mixed economy’ of different affordable housing providers and models. The Government is supportive of schemes that can be shown to genuinely meet assessed local need, have local support, encourage home ownership and mixed communities, and meet the standards required of affordable housing.”

“The Government (through the Housing Corporation and others) will continue supporting projects to help communities use Community Land Trusts to deliver grant-free affordable housing, and where appropriate, will support the development of pilots and ‘toolkits’.”

The Housing Corporation confirmed on the 9^th of July that Community Land Trusts will for the first time been given access to its national investment programme.²¹

21 http://www.housingcorp.gov.uk/server/show/ConWebDoc.11459/changeNav/431

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Epilogue

The ‘Planning Policy Statement 3 (PPS3) Housing’ published Nov 2006 which local planning authorities must have regard to after April 2007 contains the following policy guidance to local planning authorities:

“In developing their previously-developed land strategies, local authorities should consider a range of incentives or interventions that could help to ensure that previously-developed land is developed in line with (housing and planning) trajectories. This should include (…) encouraging innovative housing schemes that make effective use of public sector previously-developed land” (page16).

The policy statement ‘Delivering Affordable Housing’ published by Communities and Local Government in November 2006 contains the following guidance to local housing authorities:

“Some private companies and community-led groups are developing innovative schemes that offer intermediate affordable housing, often without a grant.

(though they may require other forms of subsidy, such as land). Alternative forms of provision can be good value, and the Government believes that local authorities should not reject them without carefully considering the advantages.”

Community Land Trust Model more relevant than other affordable housing schemes

From “Common Ground – for Mutual Home Ownership” by The New Economic Foundation and CDS Co-operatives:

“In the present low-interest environment, Shared Ownership has become unaffordable for most key workers in both regions. To make Shared Ownership work, in Gloucestershire for example, heavily discounted land is needed (or the equivalent in subsidy of 65 per cent of market value). Homebuy is popular but, at the standard 25 per cent equity loan rate, it is in most circumstances only a realistic option for households with two salaries. In the London Borough of Hackney, the rate needs increasing to the maximum 40 per cent to be viable. For that reason, there was much interest from the housing professionals consulted in the idea of an innovative mutual approach with lower transaction costs and other inherent savings.”

“Thus the CLT aspect ensures that, unlike other previous low income shared ownership models, permanent affordability can be guaranteed for generation after generation of low to moderate income households.”

From Community Land Trusts & Mutual Housing Models A research report for the Mayor of London, GLA, May 2004 :

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Epilogue

“Unlike traditional shared ownership schemes the model delivers intermediate housing that is London Plan compliant, with the public subsidy in the form of the land locked in for future generations”

“The political importance given to preventing an asset giveaway was demonstrated by the announcement by the Deputy Prime Minister of the need to make better use of public sector land through the provision of affordable housing where the public sector keeps the freehold “in trust”, thus ensuring future affordability. This directly reflects the raison d’être of the CLT and its mission to maintain affordability, prevent social polarisation and promote sustainable communities.”

Benefits of Community Land Trust in the past

Burlington Community Land Trust, one of the oldest (1984) and biggest CLT in the United States, has for over nineteen years, been doing what it promised to do.²²

Promising future for CLTs in England

In June 2007 the Government's regeneration agency, English Partnerships, gave the go ahead to organisations involved in the development of a Community Land Trust and mutual home ownership pilot project. English Partnerships will work with local

22 PERMANENTLY AFFORDABLE HOMEOWNERSHIP: Does the Community Land Trust Deliver on Its Promises? A Performance Evaluation of the CLT Model Using Resale Data from the Burlington Community Land Trust Prepared by: John Emmeus Davis Amy Demetrowitz. (May 2003)

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groups, and the national co-operative housing organisation - CDS Cooperatives - to develop the pilot on The Cashes Green hospital site in Stroud, Gloucestershire.

In a statement, English Partnerships said it is committed to supporting and encouraging innovative methods of delivering affordable homes and has agreed in principle to support this proposal from Gloucestershire Land for People and CDS Co- operatives. As this is such a unique project, the approach will need to be endorsed by the Department of Communities and Local Government, the agency's sponsor department.

David Warburton, English Partnerships' Director for South West England, said;

"We welcome this approach for a Community Land Trust pilot project. It provides for significantly lower entry prices for home ownership in perpetuity by utilising what is known as a Mutual Home Ownership model and it will help us achieve high quality, well designed, sustainable and affordable places for people to live."²³

What do the politicians think about the Community Land Trust proposal?

• From Like a house on fire, a report by Jenny Jones Green Party Member of the London Assembly (spring 2007):

“The London mayor should promote Community Land Trusts as a model for affordable community housing. He should lobby national Government to release the 76 hectares of surplus public land in London, which could provide a maximum of over 30,000 homes, for CLTs”

• Communities Secretary, Hazel Blears (Labour Party) has set out the Government's intention to encourage community asset ownership. She said: “I've long been an advocate of transferring assets to communities.”

• Shadow Housing Minister Michael Gove (Conservative Party) is to lead a special taskforce which will investigate how to extend the use of Community Land Trusts in order to halve housing costs for a new generation of first-time buyers.²⁴

• The Liberal Democrats attacked the Conservative’s latest housing policy initiative as a desperate attempt to catch up with reality without offering a new vision. Liberal Democrat Housing Spokesperson, Dan Rogerson MP said²⁵:

”There’s no need to set up a taskforce to look at whether community land trusts can deliver affordable housing - they already are, and have been doing so for many years

23 http://www.gloucestershirelandforpeople.coop/ (11^th June 2007)

24 http://firstrung.co.uk

25 http://www.libdems.org.uk

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Epilogue

in the UK. The key issue is whether there is land available to make them work. One answer is to use surplus land held by Government departments such as the MoD, the Department of Health and English Partnerships. Another is to use the planning system to require developers to provide land that can then be handed over to the land trusts.”

Conclusion

• On the 30th of July, London Citizens is launching its new campaign

“OUR HOMES, OUR LONDON. A call for affordable homes through community land ownership.”

• It is the culmination of over 4 years of organising, cooperation and research.

• CLTs are a solution for those who cannot buy but do not qualify for social housing. They have many benefits – affordability generation after generation being just one.

• The Mayor of London has committed to create the first CLT in the capital in partnership with London Citizens.

• If the Mayor can, why not other landowners? This is our call.

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References

BSHF (2005) Redefining the commons: Locking in Value through Community Land Trusts.

Burlington Community Land Trust (2003) Permanently Affordable Homeownership, Burlington, Vermont: BCLT

Conaty, P., Birchall, J., Bendle, S. and Foggitt, R. (2003) Common Ground – for Mutual Home Ownership, London: CDS Co-operatives, New Economics Foundation, Housing Corporation

Confederation of Co-operative Housing et al. (2002) Community Land Trusts – Report on a Feasibility Study, Birmingham: Birmingham City Council and the Housing Corporation Communities and Local Government (2006) Delivering Affordable Housing

Communities and Local Government (2006) Planning Policy Statement 3 (PPS3) Housing Communities and Local Government (2007) Homes for the future: more affordable, more sustainable

GLA (2004) Community Land Trusts & Mutual Housing Models - A research report for the Mayor of London, London: GLA.

GLA (2006) Towards the Mayor’s Housing Strategy

HM Treasury (2006) The Report of the Shared Equity Task Force Jenny Jones (2007) Like a House on Fire

London Housing Federation (2005) In the Middle of our Street ODPM (2003) Overcrowding in England 2000-2003

Quirk Review (2007) Community management and ownership of public assets Shelter (2004) Crowded House

Websites:

Burlington Community Land Trust: www.bclt.net CDS Co-operatives: www.cds.coop

Communities and Local Government: www.communities.gov.uk Community Land Trusts website: www.communitylandtrust.org.uk Housing Corporation: www.housingcorp.gov.uk

ODPM: www.odpm.gov.uk

Joseph Rowntree Foundation: www.jrf.org.uk

New Economics Foundation: www.neweconomics.org

Gloucestershire Land For People: www.gloucestershirelandforpeople.coop

How Community Land Trusts can solve the London housing crisis