Across the country, Community Land Trusts (CLTs) and shared-equity housing models have expanded access to homeownership for people who might otherwise be locked out due to systemic barriers, such as the racial wealth gap and rising housing costs. Doug Ryan, Vice President of Housing Policy at Grounded Solutions Network (GSN), is leading a national effort to promote permanently affordable homeownership and secure public policies that recognize these homes as valuable community assets.
“Community Land Trusts [and other shared-equity models] are more than just tools for affordability today— they are models of stewardship. The goal is to ensure that land continues to serve the community, creating stable homeownership opportunities for generations to come,” says Ryan.
Despite their success in expanding affordable homeownership, shared-equity models face a significant challenge: property taxes.
Traditionally, property taxes are based on a fee simple structure— the predominant form of homeownership in the U.S. Under fee simple ownership, a homeowner owns both the land and the house structure outright, with full rights to the property. Property taxes are assessed under the assumption that both land and house will appreciate without restriction, reflecting their full market value.
However, shared-equity models operate under a fundamentally different ownership structure, prioritizing long-term affordability over the speculative market value.
CLTs separate ownership of the land from that of the house, placing the land in a trust for the community to ensure permanent affordability of the home. CLT homeowners buy and own only the structure, while the trust retains ownership of the land, leasing it to the homeowner under long-term affordability agreements.
Similarly, other shared-equity models apply resale price restrictions, capping appreciation in exchange for an affordable purchase price. Some models also allow families to purchase a unit within multi-family housing with a capped appreciation rate, balancing affordability with wealth-building opportunities.
Many states, however, continue to assess property taxes on shared-equity homes as if they were unrestricted market-rate properties, following the fee simple model. In other words, tax assessments still calculate taxes on both the land and the house as if both were sold at full market value.
In reality, the house is sold at a restricted price, while the land is held in trust and cannot be sold at full market value. This mismatch between tax policy and market value leads to inflated tax bills, undermining affordability and limiting the potential of shared-equity models to support sustainable homeownership.
If property tax assessments were based on the actual resale-restricted market values of CLT and shared-equity homes— rather than using a fee simple assessment— homeowners would face lower, more appropriate tax burdens. Such a policy change would help preserve long-term affordability and prevent excessive taxation from eroding the benefits of these housing models.
Ryan and his team at GSN are working to change tax assessment policies for shared-equity ownership models, like CLTs, ensuring that the house is assessed based on its resale value while the land— which holds long-term community value— is assessed in a way that reflects its affordability commitments, rather than traditional fee simple assumptions.
“Stable homeownership, which allows families to build wealth and strengthen their communities, is far more valuable [for government] than extracting short-term tax revenue from these properties,” Ryan emphasized.
To advance these reforms, GSN is working closely with local leaders, tax assessors, and policymakers, tailoring solutions to each state’s unique legal and economic landscape. Rather than imposing a one-size-fits-all model, they facilitate conversations, share successful examples from neighboring states, and empower local organizations to drive policy change from within their communities.
This approach has already led to meaningful reforms. States like California, Colorado, Florida, Massachusetts, North Carolina, Texas, and Washington have implemented tax policies that align with GSN’s vision, demonstrating bipartisan support for these changes. These policy wins are paving the way for broader adoption nationwide.
The benefits of shared-equity homeownership extend beyond individual families to communities and local economies. These models:
- Increase local economic activity: Homeowners build equity and have greater spending power, benefiting small businesses and community investment.
- Promote community stability: Homeowners in shared-equity programs stay in their homes longer than traditional first-time buyers, strengthening neighborhood cohesion.
- Improved revenues: Localities can enhance housing supply, which bolster tax rolls; pairing with land banking can leverage unused or underdeveloped land to expand tax base.
Reforming tax policy state by state to align with these principles would remove a major barrier to expanding these proven models and provide more families with the opportunity to build wealth through homeownership.
GSN is driving this change by leveraging research, technical expertise, and advocacy to reshape tax policies so that CLTs and shared-equity housing can be available across the U.S. By working alongside local stakeholders and policymakers, GSN helps these homes be recognized as long-term community assets that provide stability, opportunity, and generational wealth for families everywhere.