Helping Communities Build: A review of the Community Land Trust Funds and lessons for future support

"The context for the study Across England and Wales increasing numbers of people are seeking to solve housing problems through organisations which are led by local residents. Whether this is to address a shortage of affordable housing, or to improve the quality of the existing housing stock, such ‘community-led housing’ is experiencing a renaissance, buoyed by government’s recent commitment of £163m of funding. Community Land Trusts (CLTs) are one model for this form of action, being initiated and led by residents to provide stewardship of land, and to manage housing and other assets for a community’s benefit. The CLT Funds, managed by CAF Venturesome, have provided a unique and longstanding source of repayable finance to such organisations, developed with philanthropic capital from The Charities Aid Foundation (CAF), the Esmée Fairbairn Foundation, the Nationwide Foundation, the Tudor Trust and individual philanthropists. This finance was provided in two separate funds, the first running from 2008-2014 and the second from 2014-2019. The similarities between the funds, and the combined analysis of them in this report, means that for ease of explanation they are referred as the singular ‘CLF Fund’ throughout. Commissioned by CAF, this report assesses 10 years of the CLT Fund’s activity, analysing evidence from the Fund’s investment database, a survey of the Fund’s investees and numerous in-depth interviews with representatives of investees and other community-led housing groups. This provides a unique insight into the role and value of the Fund in providing repayable finance to such groups, and has enabled us to explore how a more effective system for funding and repayable finance may be built in future. These are timely contributions, as the government’s Community Housing Fund opens for applications, and as CAF Venturesome considers options for the future of the CLT Fund after 2019. CLT Fund investments, housing outputs and affordability outcomes The CLT Fund has provided £4.4m of pre-development and development finance to CLTs since 2008. It has made 57 investments in CLT housing schemes, to 33 individual groups, and has directly contributed to the creation of 105 new affordable housing units, with an additional 419 in the pipeline. The Fund has made 45 pre-development investments, at an average value of £34,600. These loans have been made ‘at risk’, only being repaid when a group’s scheme starts on site. Four fifths of these loans have been repaid and recycled back into the Fund, or they are still being used to bring sites forward. For those schemes that did not come to fruition, for instance if planning permission was not secured, then the loans were transferred to grants. Such write-offs have run at slightly lower levels than expected; 13 per cent of the capital provided for pre-development, compared to the 16 per cent envisaged."