The establishment of community land trusts could free the cost of land from market forces and encourage more innovative solutions to affordable housing, an architecture forum has heard.
The forum, hosted by the City of Sydney last week as part of the Sydney Architecture Festival, brought together planners, architects and innovators to canvas housing affordability solutions.
The event showcased the ideas of seven shortlisted teams for Council’s Alternative Housing Ideas Challenge, including a proposal for a metropolitan lands trust policy framework.
Affordable housing expert Dr Louise Crabtree, a senior research fellow at Western Sydney University, and Jason Twill, director of urban advisory and property development firm Urban Apostles, told the forum the commodification of land is the primary challenge facing many cities.
They believe this can be addressed by the establishment of community land trusts (CLTs), a form of shared ownership where land is owned by a community-based, not for profit entity which acts as a “steward” for the land, while the property on it is owned or leased to an individual householder.
“The basic premise of a community land trust is to hold the land value out of the market to as great of an extent as possible,” Dr Crabtree told Government News.
“So once you’ve got that price out, that frees up the developer, in this case the non-profit, to be able to do those more innovative things because they’re not carrying that debt burden that comes with that exorbitant cost of land.”
It would also allow for more innovative housing models to be built, Dr Crabtree said.
“Because that base is out, and that demand to make the top dollar to cover the cost of that land is taken out, it just enables this incredible innovation because you’re operating to a different logic, you’re answering those community objectives and aspirations,” she said.
“The basic premise of a community land trust is to hold the land value out of the market to as great of an extent as possible.”
Under the model proposed by Dr Crabree, a community trust could be comprised of thousands of voting members with the board made up of residents, wider urban or regional representatives and elected members.
She said she would like all levels of government coming together to help create a lending ecosystem that backs up more diverse models of land ownership.
Considering the community
Deborah Brill, Executive Director of Policy and Innovation for the Department of Planning, Industry and Environment, said it’s important to consider what the community wants in terms of land use.
“In a financial environment where banks are really risk averse as well, are they ready to start thinking about appreciation of housing in a different way? Because a lot of the appreciation of a house and land package is the land not the house.”
“Are we as a community ready to own a house but not own the land underneath it?’
Professor Bill Randolph, Director of the City Futures Research Centre, Built Environment at UNSW, said there was huge potential for not-for-profit involvement in land management and development.
“You can do fantastic things if you just (work) with the non-profit sector to get on with doing creative stuff, without the shackle of having to compete for land with Lendlease or Stockland or any other developer,” he said.
He said Treasury’s insistence on high return from every piece of land was contributing to the problem.
“We need Treasuries to say ‘yeah, we actually do see there’s a social value and a social return on giving a social best use to public land’ and feeding it into the process,” he said.
CLTs are currently being used in other parts of the world to improve housing affordability, including the US and UK. However, they are less common in Australia, Dr Crabtree says.
“I think for a long time housing was accessible to enough people for us to not be having to think seriously about how we were treating land and the role of it in driving the prices up,” she said.
Community land trusts have been backed by the Australian Housing and Urban Research Institute (AHURI), which says they can benefit governments by assisting lower income households into affordable rental or housing ownership and relieve the strain on housing assistance programs.
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