Housing simply costs too much. In the 1960s, the median price for a house in the U.S. was $96,000 (adjusted for inflation). Now, it’s $226,000. Meanwhile, half of all renters are cost burdened, paying more than 30 percent of their income towards housing. The pathways to homeownership are scarce and high-risk for those below the area median income.
It's clear that we must reimagine the mechanics of Affordable Housing in order for things to change...
The experience of SquareOne Villages has informed one pathway for doing so.
The Village Model provides a collaborative, community-based approach to building and sustaining permanently affordable places to call home.
It's an innovative form of resident-owned housing that ensures long-term affordability, eases displacement pressures, builds community wealth, and reduces the cost and environmental footprint of housing.
This page provides a framework to assist other communities in implementing The Village Model. It seeks to inform and mobilize a broad range of stakeholders around a vision that is both actionable and transformative—meaning it can be accomplished in the world as it currently exists, yet it also points in a direction of broader change in how we think about housing.
Cooperative Land Trust Housing...
The Village Model includes an innovative ownership structure that brings together two forms of shared-equity homeownership—a Community Land Trust (CLT) and a Limited Equity Cooperative (LEC)—also known as Cooperative Land Trust Housing. In this arrangement, the CLT retains ownership of the underlying land, while residents form a LEC that owns and manages the housing and improvements on the land.
The result is a pathway to sustainable resident-owned housing for people with very low-incomes, which can be achieved by using similar or smaller amounts of public subsidy than rental housing that targets the same income levels. Furthermore, it includes strong affordability controls to ensure that the housing stock remains permanently affordable for future generations to come. This multi-layered ownership structure has proven to be a stable, low-risk financial investment for both the lender and the low-income homeowners, when compared to conventional homeownership.
A long-term ground lease ties the interests of both parties together, creating a partnership that helps to ensure the longer-term viability of the co-op. SquareOne is able to serve in an advisory role, providing support to the co-op in the form of technical assistance, training, and leadership development. And due to its sustained involvement in the project, SquareOne also serves as a “mission steward” during periods of leadership change and member turnover within the co-op.
Building Small & Green Infrastructure...
The Village Model clusters a variety of compact residential dwellings around shared community spaces and resources—including tiny house villages, cottage clusters, plexes, townhomes and other forms of community-oriented multi-family housing that provide significant economic, environmental, and social benefits compared to the traditional apartment building or single-family house.
These compact communities combine the privacy and autonomy of a single-family house with the greater density and economy associated with an apartment building. However, it replaces hallways and elevators with meandering pathways and common areas. The space between houses creates a medium for casual social interactions, fostering a strong sense of community and belonging among neighbors. Building small also reduces material and energy demand during construction, and offers lower maintenance and utility bills over the life of the home. Furthermore, it offers a more approachable scale for activating citizen involvement in all stages of housing development.
While these Village Building projects often require large, undeveloped sites that are in limited supply, this concept can also be adapted to reimagining our existing single-family neighborhoods. The Re-villaging Project puts forth a scalable model for creating multi-family infill housing on a typical residential lot.
A Sustainable Mix...
The Village Model seeks to implement a scalable financing strategy that includes a sustainable mix of public subsidies, charitable contributions, debt financing, and resident equity.
Public funding available for new affordable housing construction remains inadequate, and often adds unnecessary complexity and cost to new development. By diversifying our funding sources while keeping expenses low through a combination of affordability strategies, we believe The Village Model is uniquely positioned to maximize the social return on investment when compared to other forms of low-income housing. If debt financing can be kept at sustainable levels through one-time capital subsidies, housing co-ops enable low-income residents to cover the cost to operate their housing without dependence on ongoing subsidies.
Furthermore, the ownership structure ensures that the housing developed will be retained at affordable rates in perpetuity, helping family after family access shared-equity homeownership. With the ability to operate at cost while also ensuring permanent affordability, The Village Model is an ideal vehicle for investments in affordable housing.
The Village Model is founded on building equity and inclusion through diverse community collaborations that create more affordable housing opportunities.
In developing this framework plan we hope to collaborate with 1) other nonprofit housing developers that can help build more villages, 2) lending institutions, social investors, and donors that can help finance more villages, 3) public policy makers that can advocate for and guide new legislation and funding programs to support this model, and 4) prospective residents interested in this affordable housing option.