Young people and first-time buyers face a perennial challenge in the housing market – too few properties and those that are available are often beyond their reach financially. Between the recent decision to exempt first-time buyers from paying stamp duty on the first £300,000 of a property purchase and the Government's aim to build 300,000 homes a year by the mid-2020s, it's clear that fixing the housing market is a long-term project that will involve lots of diverse ideas.
One of those ideas is using community land trusts to provide affordable homes to local people, linking house prices to local wages. Affordability and localism are the radical elements of community land trusts (CLTs), and there is clear momentum behind the idea, with half of the existing 225 trusts in England and Wales having been formed since 2015. In 2010, there were only 36 CLTs in operation.
£60m funding from government
The Government has already provided £60 million in grants to help 148 local authorities back more community-led housing projects, and on November 27, Housing Minister Alok Sharma announced a further £60m in funding that will support an increase in community projects.
Mr Sharma was speaking at the first National Community-Led Housing Conference in London, organised by the National Community Land Trust Network, where he told delegates: "When the community-led movement began, it was producing just a handful of homes each year. First that grew to a few dozen, then to a few hundred. Now, with government on your side, there is no reason why those hundreds cannot become thousands."
The funding will help establish an advisory network for community groups while those looking for financial backing to build more affordable homes in their local area can start bidding for funding from January. Homes England, the new national housing agency that was announced by Chancellor Philip Hammond in the Budget on November 22, will assess the bids and control the funding.
Prices pegged to local incomes
One successful community land trust is up and running in Mile End, east London, where average house prices are £517,166. Membership is open to anyone who lives or works in the area and its 23 homes are sold or rented at a price pegged to local incomes. Those who buy a property at the local rate can then only sell at a price pegged to local wages, meaning there is no opportunity to bank a huge windfall from a jump in property prices. This keeps the properties affordable for new buyers and renters, and that makes community land trusts a more radical form of housing.
This type of community-led project is considered ideal for both urban and rural areas as it takes both land availability and local wages into account. There are CLTs running in the likes of Shropshire, Devon and Cambridgeshire, Brighton, Middlesbrough and Liverpool.
Catherine Harrington, director of the National Community Land Trust Network, said: "We now have a once in a lifetime opportunity to turn community-led housing into something anyone, wherever they are, can do. We can grow the number of CLTs, cohousing, community self-build groups from hundreds to thousands."