A truly affordable housing model

Last spring, Amanda Donnell stumbled upon a rare anomaly in the local real estate market: a house for sale under $ 200,000.

At $ 185,000, the place was not in great shape and had actually been listed at $ 112,000 the year before. But it was in its price range. At least that’s what she thought. Another buyer quickly barged in with a high cash offer, and she was gone.

A year later, homes under $ 200,000 no longer exist in the Flathead Valley.

“Right now, there’s no way I can step into anything in the regular market,” Donnell said.

Fortunately, she doesn’t have to deal with the regular market. Earlier this year, Donnell received a call indicating that a house through the Northwest Montana Community Land Trust was available. She was on the waiting list and the wait was over.

After finalizing the purchase, Donnell and his two sons moved into their $ 170,000 Kalispell home in March. Her USDA-subsidized mortgage payment is comparable to the $ 775 plus storage unit fees she was paying for her “completely run down and run down” rental.

“I’m essentially paying the same for a really awesome three-bedroom, two-bathroom, 1,800 square foot home with a big garden,” she said, adding that she didn’t have no longer have to worry about the sudden increase in his rent. , which she says is happening frequently now in the valley.

All of this is made possible by the unique model of the community land trust.

“It’s amazing that this program exists,” said Donnell, a single parent with a full-time job. “It’s great to know that there is something that average people, people who work hard, who live in the community and integrate into the community and love it, knowing that there really is a option to keep us here and make it affordable for us. “

The Northwest Montana Community Land Trust was established as a non-profit organization in 2009 with a mission to provide permanently affordable homeownership opportunities to low and moderate income families in the Flathead Valley. It is one of more than 225 community land trusts in the United States, according to the Grounded Solutions Network.

“It’s important elsewhere, and it’s growing,” Kim Morisaki, the organization’s new executive director, said of the community land trust model.

A community land trust, not to be confused with a conservation-oriented land trust, purchases properties to be held in trust as permanent affordable housing options. Locally, buyers buy the home itself, while the Northwest Montana Community Land Trust retains ownership of the land, with landlords paying a monthly land lease of $ 25.

Separating the land from the structure keeps prices low. If the owners are willing to move, they sell the house back to the trust at a price that allows them to recoup their original investment plus 25% of the increase in appraised value since buying the house. The trust then resells the house at a price not to exceed 25% of the increased appraisal value.

“The house will remain affordable forever,” said Morisaki. “It will never come back to market rate.”

During its formation in 2009, the Northwest Montana Community Land Trust purchased a list of properties in the recession foreclosure market. These low initial purchase prices mean that all of the homes that become available now, especially those that haven’t changed hands in the past 12 years, are still incredibly cheap by local housing standards, well below. of the market rate.

The trust currently has homes available, albeit with a waiting list, ranging in price from $ 111,000 to over $ 200,000. Buyers must meet income eligibility criteria and be eligible for a mortgage.

The association, in partnership with NeighborWorks Montana, has hired Morisaki as an executive director as it seeks to expand its current inventory to 52 homes, spread around Kalispell. Morisaki hopes to expand the affordable housing portfolio both in Kalispell and in other communities such as Columbia Falls.

Morisaki, who previously worked at Montana West Economic Development, also spoke with community leaders from Lake, Lincoln and Sanders counties to explore potential projects there. She admits that many people have never heard of the association.

“The first step is to let people know that this really exists so that we can get the right people to apply,” she said. “The other step is to find partners.”

Partners could include businesses that offer annual business support, similar to a United Way donation model. Other potential partners include developers or landowners, especially those planning their estates, who wish to contribute to affordable housing while enjoying tax benefits. Donating land or selling property to the trust at a reduced price would be considered a non-profit donation and would be a tax deduction.

“These will be people with a heart for it, people who just care that the average valley employee cannot afford to buy a house,” Morisaki said.

The community land trust has the ability to leverage federal and state funds with private donations of property or money while working with private developers or other community members “who want homeownership to stay. possible for the average Flathead Valley resident, ”according to a press release from the Land Trust.

Partnerships are critical to Northwest Montana Community Land Trust’s ability to purchase more homes, given the expense of buying properties at market rates in a booming local housing market. In 2009, the trust was able to scour the foreclosure market for decently priced homes.

Municipalities are other potential partners. The City of Columbia Falls has set aside $ 135,000 in housing funds for the Community Land Trust to establish a presence there, which is supported by a Weyerhaeuser grant. Morisaki said building momentum at Columbia Falls is “a step in the right direction.”

“The more homes we have, the more affordable we have for the workers who run the Flathead Valley,” she said.

For more information, including apps, visit www.nwmtclt.org. Individuals and organizations interested in learning more about or contributing to the association can call Kim Morisaki at (406) 261-8831.