What Is a Community Land Trust?

A Community Land Trust (CLT) is a nonprofit organization that owns land and keeps it affordable for housing.

Here is the key idea:

• You buy the home.
• The CLT keeps ownership of the land.
• When you sell, the resale price follows a formula.
• The home stays affordable for the next buyer.

This model reduces speculation and protects long-term housing affordability.

What Is a Community Land Trust Affordability Calculator?

A Community Land Trust Affordability Calculator is an online tool that estimates:

• Your monthly mortgage payment
• Your housing cost burden
• Your future resale price
• Your projected profit or loss
• The “community investment” preserved in the home

It uses common CLT formulas and financial assumptions to give you a practical estimate.

It does not replace official numbers from your local CLT. But it helps you understand how shared equity works.

How the CLT Affordability Calculator Works

The calculator uses several inputs to create your affordability analysis.

Let’s break it down in plain language.

1. Household Income

You enter your total annual household income.

The calculator:

• Converts income to monthly income
• Compares it to your estimated mortgage payment
• Calculates your housing cost burden

If your mortgage payment is more than 30% of your income, it may show “High Cost Burden.”

Why 30%? Because housing experts often use that as a general affordability benchmark.

2. Household Size and State

The calculator estimates your Area Median Income (AMI) using:

• A national base income
• Adjustments for household size
• A state-level multiplier

AMI matters because many CLTs limit eligibility to households earning a percentage of AMI.

For example:

• 80% of AMI
• 100% of AMI
• 120% of AMI

This helps determine whether a resale price stays affordable for future buyers.

3. Home Price and Appraised Value

You enter:

• Current appraised value
• Your purchase price

In a CLT, the purchase price is usually below full market value. That discount is part of the long-term affordability structure.

4. Mortgage Details

The calculator estimates your monthly mortgage payment using:

• Mortgage rate
• Loan term (15 or 30 years)
• Purchase price (as loan amount)

It uses a standard mortgage payment formula.

This gives you a realistic estimate of your monthly cost.

5. Market Appreciation Rate

You can choose an assumed annual appreciation rate.

For example:

• 3% per year (moderate growth)
• 0% (flat market)
• Negative values (declining market)

The calculator uses compound growth to estimate future market value after the number of years you plan to live in the home.

Understanding CLT Resale Formulas

This is where things get interesting.

The calculator allows two common resale models.

Option 1: Homeowner Captures a Percentage of Appreciation

This is the most common CLT formula.

Here is how it works:

• The home increases in value.
• You receive a percentage of that increase.
• The rest stays in the home to preserve affordability.

Example:

• Appraised value: $300,000
• Future market value: $360,000
• Appreciation: $60,000
• Homeowner share: 25%

You receive: $15,000
The remaining $45,000 stays in the home.

This preserved amount is called the community investment.

It keeps the resale price lower for the next buyer.

Option 2: Fixed Percentage of AMI

In this model:

• Resale price is tied directly to a percentage of AMI.
• Market appreciation does not directly determine resale value.

Example:

If resale is capped at 80% of AMI, the home price adjusts based on income levels, not market spikes.

This method creates strong long-term affordability.

What the Results Mean

After clicking “Calculate Affordability,” the tool shows several key results.

Let’s walk through them.

Current Monthly Mortgage Payment

This shows your estimated payment based on:

• Loan amount
• Mortgage rate
• Loan term

It does not include taxes or insurance unless added separately.

Housing Cost Burden

This shows:

Mortgage payment ÷ Monthly income

If it is:

• Under 30% → Generally considered affordable
• Over 30% → May indicate financial strain

Future Market Value

This is what the home might be worth on the open market after your selected number of years.

It uses compound appreciation.

Maximum CLT Resale Price

This is the price you are allowed to sell for under the CLT formula.

It may be lower than market value. That difference preserves affordability.

Estimated Profit or Loss

This shows how much equity you gain under the CLT model.

It compares:

• Resale price
• Purchase price

Profit vs. Standard Market Sale

This compares:

What you would earn on the open market
vs.
What you earn under the CLT formula

This difference is labeled as the community investment.

Community Investment (Shared Equity)

This is the amount of appreciation that stays with the home.

It helps the next buyer purchase at an affordable price.

It is not lost money. It is part of a shared equity system that balances wealth-building and long-term stability.

Affordability for the Next Buyer

The calculator estimates what percentage of AMI the resale price would serve.

This shows how the home remains affordable across generations of buyers.

Why This Calculator Matters

Many buyers ask:

“Am I giving up too much appreciation in a CLT?”

This calculator helps you see the trade-off clearly.

Yes, you may earn less than in a fast-rising market.

But you gain:

• Lower purchase price
• Reduced entry barrier
• Stable housing
• Protection in a declining market
• Predictable resale formula

In slower or declining markets, CLTs can actually protect homeowners from losses.

Example Scenario

Let’s say:

• Income: $75,000
• Purchase price: $250,000
• Market value: $300,000
• Appreciation: 3% annually
• Years in home: 10
• Homeowner share: 25%

The calculator may show:

• Affordable monthly payment
• Moderate equity growth
• Lower resale than open market
• Strong preserved affordability

You build wealth. The next family gets an affordable home. The community benefits.

Important Disclaimer

This calculator provides estimates only.

Each Community Land Trust has:

• Its own resale formula
• Its own income limits
• Its own eligibility rules

Always contact your local CLT for official numbers.