A community land trust is a nonprofit model that enables affordable housing to remain affordable virtually forever. The premise of the model is to convey ownership using a 99-year ground lease, which intentionally limits appreciation. There are more than 250 CLT’s throughout the United States, and 10 in North Carolina.
Our homes remain affordable because we limit appreciation that can be realized by our homeowners. We are able to limit appreciation because we retain the deed to all of our properties. We convey an ownership interest in these properties using a 99-year ground lease, which is consistent with the community land trust model. Our objective is to keep our homes affordable to future home buyers who will need affordable housing options.
There are two key differences: Community Home Trust homeowners must reside in their homes, and they cannot sell their homes to anyone at any price. However, like private market owners, Community Home Trust homeowners have the security and tax advantages of ownership along with the financial obligations of the property including but not limited to: the mortgage, homeowner’s insurance, homeowner’s association dues and annual property taxes. Our homeowners are responsible for maintaining their homes and addressing repair needs (e.g. servicing the HVAC system, changing the air filters monthly, fixing leaks, etc.).
The ground lease is the document that transfers the rights to buy, own, possess, and sell a Community Home Trust property. It also provides some limits on the rights to alter, convey, and profit from that property. The ground lease requires the home be your primary residence.
Appreciation is not related to the actual market value of the homes. Buyers can earn between 0% – 1% per year of ownership on their investment in the home. Appreciation is tied to the median family income for a family of 4, which is published by HUD each year. Buyers also cannot lose money on their homes, so the worst case scenario involves a homeowner selling their home for the same amount for which they purchased it. Even with no appreciation, owners can still gain equity by paying down their mortgage each year.
In 2023, the average Community Home Trust homebuyer paid $114,733 for a home.
Eligibility FAQs
Families or individuals can apply if they meet the income limits, can afford the home, and can get a loan.
Most homes: You must earn less than 80% of the Area Median Income (AMI) set by HUD each year.
Some homes: You may earn up to 115% of AMI.
You cannot get new help with subsidy funds.
You may still buy a home that already has subsidies.
Your monthly house payment (not including utilities) must be 30% or less of your gross monthly income.
The Home Trust usually aims for 28%, and lowers this by 1% for each child or dependent.
We use HUD’s income rules, even if HUD funds are not used.
Sometimes, certain income may not be counted if it helps with affordability.
Not always. You must also:
Be approved for a mortgage, meet the affordability rules for the home, and follow any subsidy rules for that home.
You are a “student” if you work less than 32 hours a week and are enrolled in college, grad school, or community college. New homes under construction: Students can buy leftover units after the building is finished.
Resale homes: Students can buy after the home has been listed for 30 days. If you went back to school after being out for 10 years or more, you are not counted as a student.
Most families must have at least one person working 32 or more hours each week.
Exceptions may be allowed if you are disabled but meet affordability rules.
You are age 65 or older.
You are self-employed or do seasonal work but still meet the rules
You are the main caretaker of a child under 12 or someone who needs care all day.
You are self-employed or do seasonal work but still meet the rules
You are the main caretaker of a child under 12 or someone who needs care all day
You cannot own another home or have another mortgage.
Exceptions may be made if you:
Own part of a home through an inheritance and do not live there, or
Own property in another country.
Any property you own will be counted as an asset, and income from it will be added to your income.
General program: You do not need to be a first-time buyer.
CDBG funds: You must be a first-time buyer unless the home has been listed for at least 30 days.
HOME or Bond funds: You must be a first-time buyer unless the home has been listed for at least 90 days.
It is not required, but priority is given to people who live or work here.
Orange County: Must live or work in the county for 1 year before buying a HOME-funded home (waived after the home has been listed for at least 90 days).
Town of Chapel Hill (CDBG funds): Must live or work in Orange County for 6 months (waived after the home has been listed for at least 30 days).
The size of your family is matched to the size of the home when possible.
Example: A 2-person family can buy a 1–2 bedroom home.
All assets are counted as if they make money, even if they do not. HUD’s set rate is used.
Assets under $20,000 (not including retirement): Fully eligible.
$20,000–$100,000: Can buy a home but cannot get new subsidies.
Over $100,000: Not eligible, unless age 65+ or permanently disabled.
You may receive a one-time gift of up to $10,000.
Program FAQs
View the full CHT homeownership process.
A summarized version of the process is listed below:
- Review the program qualifications to self-screen for CHT homeownership.
- If you meet the criteria, complete the Readiness Questionnaire and a CHT staff member will contact you.
- When invited, complete all screening and application steps and submit all required documents.
- Keep an eye on your email for notifications when homes you may qualify for become available.
- Complete homebuyer education and visit an approved lender to get pre-qualified for a mortgage.
- Sign an offer-to-purchase contract.
The Community Home Trust Sales Department has licensed real estate agents who represent Community Home Trust but will provide professional assistance throughout the home buying process. Buyers may have their own representation, but the cost of the commission is the sole responsibility of the buyer. As with the buyer, the Community Home Trust Sales Team will assist the seller, but represents the interests of Community Home Trust. Sellers may have their own representation, but the process and guidelines for reselling a Community Home Trust home remain the same. If you are working with a realtor when you apply, Community Home Trust will pay a $500 referral fee.
We require a buyer’s total housing costs to be no more than 30% of their gross monthly income but target 28%, when possible. Housing costs include principal, interest, taxes, insurance, HOA dues, and ground lease fees.
You pay two monthly fees to Community Home Trust for the entire time you own your home. The first is a ground lease, or use fee, which is a small monthly charge that is payable to Community Home Trust. The second is the Stewardship Fee, explained below. You might see these two charges combined into one deduction from your bank account on an automatic draft.
The Stewardship Fee is dedicated to replacing specific capital systems (or major components of those systems) such as the roof, siding, air conditioning/heating system (HVAC), hot water heater, and flooring. For our single family homes, the fee also covers an annual termite inspection and warranty. These funds stay with the property and are only used to cover the replacement of those “big ticket” items listed above. The fee varies for different homes, so please ask our Sales Team about the fee on the home that interests you.
Community Home Trust will provide assistance based on need as determined by a thorough review of income and employment documentation. There may be additional criteria, steps, and documentation required depending on the source of funds. Our goal is to ensure that buyers are not over-extending themselves. We will apply subsidy to reduce a buyer’s first mortgage amount such that the monthly costs are approximately 28% of the household’s monthly gross income. We will not allow a buyer to purchase a home if the total monthly housing expenses exceed 30%.
Often, down payment assistance is available to our buyers in the form of a no-interest, no-payment loan. This means that typically a Community Home Trust buyer is not required to have a down payment to purchase one of our homes. Of course, you may choose to have a larger down payment if you wish. If your monthly housing costs exceed 30% of your gross monthly income after all subsidy has been applied, you may be required to add a down payment in order to qualify to purchase that home.
Closing costs typically range from $6,000-9,000. $1,000 is due in the form of earnest money when you sign your contract, $500-$800 is due soon after for the appraisal fee, and the remaining amount is due at the time of closing.
Gifts are allowed up to $10,000. Exceptions to this policy may be requested under very limited circumstances. We do not allow for co-signers. All gifts are also subject to lender requirements.
Due to the complexity of our land trust model, you must use one of our approved lenders to purchase a CHT home. We will provide a list of lenders at the appropriate time in the process.
Community Home Trust does not have a credit score requirement. However, our homebuyers must qualify for a traditional mortgage. This means that in order to purchase a CHT home you will have to meet lender or bank credit score requirements.
The homebuying process takes time, so even if you’re not sure when you’ll be ready to buy a house, it’s never too early to connect with us to learn more.
You can subscribe to our email newsletter to keep up to date with the organization and news.
You can complete our Readiness Questionnaire when you would like to take the first steps towards buying a home.
When you purchase a home through Community Home Trust, you sign a ground lease. This document stipulates that you must sell your home back to Community Home Trust when you move and you cannot resell it on the private market.Visit the Selling Your CHT Home page to learn more about our process.
It is important to remember that the process will take more time than selling a private market home. Although most homes sell within 90 days, you should allow up to 6 months to sell your home. Since you are responsible for maintaining all costs associated with the home until it sells, we strongly advise not purchasing another home or signing a new lease until your home closes. This will prevent you from having to financially maintain two properties.
