Central Edmonton Community Land Trust (CECLT)
By Brian Finley, Executive Director, Central Edmonton Community Land Trust, Edmonton

The goal of the Central Edmonton Community Land Trust (CECLT is to use the Community Land Trust model to promote affordable homeownership among low- and moderate-income residents in inner city Edmonton neighborhoods. Affordable homeownership is seen as a means of promoting community development and neighborhood revitalization.

CECLT uses a rent-to-own approach to promote affordable homeownership among low- and moderate income households. CECLT purchases existing homes in inner city Edmonton that are in substandard condition. Using a variety of CMHC and other grants, CECLT renovates these homes and makes them available to CECLT member households.

To become a CECLT member, a household must have an income equal to or less than CMHC’s Core Need Income Threshold (a requirement of RRAP funding). Qualifying households purchase a one-time $30 share in CECLT and submits an application along with a $25 credit check fee. These households are then interviewed by the selection committee and homes are awarded on a first-apply-first-serve basis.

The Big Breakfast House, built in 1917 and renovated by the center

CECLT’s member households are extremely diverse, including individuals and families from both Aboriginal and immigrant communities, as well as persons with disabilities.

CECLT homes are allocated according to need (i.e., preferred location, number of bedrooms, special needs, etc.). Approved households enter into a five-year rent-to-own agreement with CECLT, after which they will be given the option to purchase the home for a pre-determined price (CECLT is still too young to have transferred any of its current properties over to its member households).

The goal of the rent-to-own approach is to use the equity earned (the portion of the principal paid down on the mortgage) during that time towards the household’s down payment. Once the household takes title to its home, it will continue to lease the land from CECLT for a set fee, expected to be in the range of $50 per month. It is anticipated that the lease fees will be used to cover operating costs and to help pay for future projects. The first group of CECLT member households is expected to become homeowners by May 2005.

Key Learnings
Based on the experiences of CECLT, a Community Land Trust needs to develop a sustainable business model where revenues meet expenses on a consistent basis in order to remain viable. Government grants and private donations can provide necessary seed funding. However, these sources and the funds they provide are finite. Thus, a Community Land Trust must develop and maintain an operating model that will eventually generate sufficient revenues from the properties within the CLT to cover operating and maintenance costs.

CECLT was able to capitalize on good timing - affordable housing has been on the agenda of all three levels of government. As a result, there is strong support for the organization and seed funding has been made available (e.g., CMHC, the City of Edmonton, the Alberta Real Estate Foundation, Muttart Foundation, etc.). CECLT recognizes that this window will not always be open and so is working through its technical difficulties and redeveloping a model that will continue to be sustainable beyond current government programs.

The rent-to-own model can be problematic, especially in higher-costs centers. As CECLT is currently experiencing, households earning incomes below the Statistics Canada Low-Income Cut-offs (LICO) may not be able to contribute enough equity within a five-year period to save up a sufficient down payment. Nor are long-term renters necessarily going to be ready for homeownership within a five-year period.

Additional supports to prepare households for homeownership may be required and the rent-to-own period may need to be extended in higher-cost centers. CECLT is also currently looking at The HOME Program (an Alberta-wide homeownership education and counseling program) as a vehicle to help prepare member households for homeownership.

To be effective, Community Land Trusts need to rely on paid staff as well as a core of community volunteers. CECLT recognizes the need to be able to develop appropriate policy and enforce it. This requires a skilled and experienced Board of Directors supported by a skilled and experienced administration. As mentioned above, CECLT has recently hired an Executive Director to provide that support.

Developing a strong sense of community and common purpose is another important consideration for Community Land Trusts. This requires paying careful attention to recruiting member households who are truly committed to the Community Land Trust model and goals of the particular organization. The creation of CECLT involved the collective efforts, energy and resources of a broad spectrum of community supporters - those who believed in the Community Land Trust model and community development. The next step will be to build a stronger sense of community among the organization’s member households.

The key success of CECLT will be the day when a member household takes title and becomes a homeowner - a success that would not have been possible without CECLT.

For more information about the Central Edmonton Community Land Trust, contact: Brian Finley by email at bfinley@steadbuyeragency.com.

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