What types of CLT Development are there?

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.