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Your Questions about Community Land Trust Homeownership, Answered

  • How much can a CLT homeowner sell their home for?
    The CLT homeowner can sell their home no more than the home's "Resale Formula Price", which is set out in the Ground Lease and agreed upon before the purchase. The Resale Formula Price equals the home's initial sales price plus a fixed increase of 1.25% of the initial price per year. The Resale Formula Price is designed to allow the homeowner to build some equity in the home through appreciation, while ensuring the home is affordable to future limited-income buyers at resale.
  • Are there any restrictions on when a CLT homeowner can sell their home?
    No. There is no minimum occupancy period, and a CLT homeowner can decide to sell their home at any time.
  • Who is eligible to buy a CLT home from an existing CLT homeowner at resale?
    Only individuals who are income-qualified by the Houston Community Land Trust are eligible to buy CLT homes at resale. This ensures that the home's long-term affordability protections continue to serve individuals and families who need them most.
  • Are CLT homes inheritable by the homeowner's heirs and beneficiaries?
    Yes. The homeowner can designate in their will a person(s) of their choosing to inherit the home and the Ground Lease. Anyone can inherit the home, but unless the inheritor is a child, spouse, or household member of the deceased, that new owner must be income-qualified in order to live in the home. If they are not income-qualified, then they must sell the home back to HCLT for the Resale Formula Price. They are then entitled to keep the equity proceeds from the sale. This arrangement is designed to ensure that CLT homes are passed down to individuals and families who are in need of affordable housing. Children, spouses, and household members of the deceased are exempt from this requirement, however.
  • Are there fees associated with CLT homeownership?
    Yes. The homeowner pays a fee of $113 each month to HCLT. This amount is made up of: the Ground Lease Fee and the Exterior Repair and Replacement Reserve Fee (also called the “Maintenance Fee”), and property taxes. Ground Lease Fee In exchange for her occupancy and use of the land beneath her home, the CLT homeowner pays HCLT a monthly Ground Lease Fee, due on the first day of each month. This fee is $50 each month, as set forth in the Ground Lease in Section 5.1. The Ground Lease Fee may be adjusted for inflation by HCLT no more than once per year. Exterior Repair and Replacement Reserve Fee or the “Maintenance Fee” To preserve the physical condition of the major exterior systems of the home, the CLT homeowner pays HCLT a Maintenance Fee of $50 each month. Maintenance Fee payments are deposited by HCLT into a reserve fund dedicated specifically to that home. Maintenance Fee reserve funds may be used by the current homeowner, or subsequent owners of the home, to maintain and repair the roof, exterior siding, exterior paint and finishes or similar features of the home. The Maintenance Fee reserve funds remain with the home until they are withdrawn for needed repairs or maintenance by a current or future homeowner. A homeowner cannot withdraw unused Maintenance Fee reserves when the home is sold. Maintenance Fee payments are due on the first day of each month, and may be adjusted for inflation by HCLT no more than once per year.
  • How are property taxes handled on the home?
    Because CLT homeowners enjoy the benefit of the land and the surrounding community services (schools, roads, etc.), they are responsible for paying property taxes on both the home and the land as assessed by Harris County Appraisal District (HCAD) or other local taxing districts. One benefit of the program is that CLT properties are appraised based on their affordable resale value, not on surrounding market values--making the property tax bills on CLT homes significantly lower than on conventional market-rate homes.
  • How may CLT homes be used by homeowners?
    The homeowner must only use the home for residential and related purposes. The homeowner must use the home as their primary residence and homestead. This means living in the home for at least nine months out of the year. The homeowner may not use the home as a rental property. Written permission from HCLT is required for any exceptions to this policy under exceptional circumstances. The homeowner must act as a good neighbor and not create any nuisances or unsafe conditions on the property. The homeowner must maintain the home and property in good, safe, and habitable condition and in compliance with all laws, regulations and insurance requirements. The homeowner is responsible for the actions of any family, friends, or visitors in the home or on the land.
  • Who is responsible for home and property maintenance?
    The homeowner is responsible for maintenance and upkeep on the home and the land. As part of this responsibility, homeowners are required to see that all necessary maintenance, repairs, and replacements are performed on the home when needed. It is the homeowner’s responsibility pay for the cost of maintenance and repairs, as well as the costs of all utilities related to the home, including water, gas, and electricity.
  • Can homeowners make changes to the home and the land?
    Yes. The homeowner may make changes to the home, such as renovations, as long as any construction activities are performed in a professional manner, and any changes are consistent with residential use. Certain types of construction activities require prior approval from HCLT: these are modifications that affect the footprint, square footage, or height of the home or that add new, permanent structures to the land (such as a garage or fence). The homeowner is responsible for the costs of any modifications they choose to make. Homeowners should be aware that, because the home's resale price is set by formula in the Ground Lease, any capital improvements made to the home through renovations or additions will not raise the home's resale value.
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