There are broadly two different approaches to providing affordable homes through a CLT:

Option 1- the CLT

• Takes on all the risks and responsibilities itself
• Receives the full income from the properties

Option 2 – the CLT

• Works in partnership with a Housing Association
• Takes very little risk
• Leads the project
• Owns the land and receives a ground rent. (125 year lease)
• Leads on the search for a site
• Consults with the wider community
• Selects a suitable Housing Association
• Obtains a grant to prepare a planning application
• Is a party to the Section 106 Agreement (which governs the allocation of homes to local people)
• Verifies the stated local connection of potential residents.
• The Housing Association take all the risks and responsibilities involved in developing, financing and managing the scheme
• The CLT has an option to buy the Housing Association out of its lease at some point in the future; for instance, if it wished to benefit from the full rental income (in place of the ground rent) and could raise the necessary funds.