Habitat for Humanity in Whatcom County

Building lasting affordability with Kulshan Community Land Trust

The Telegraph Townhomes Project, Habitat for Humanity in Whatcom County’s flagship 50+-unit planned housing community on Telegraph Road, wouldn’t be happening without our innovative partnership with the Kulshan Community Land Trust (KulshanCLT). The Telegraph Townhomes Project is a first for both organizations in terms of scale. Phase 1A, the first 8 units, are 70% complete, with occupancy scheduled for this spring.

KulshanCLT has a local, first-time home-buyer program dedicated to creating financial opportunities to help modest-income home buyers purchase their own homes. Homeownership, in turn, as we see every day at Habitat, creates stability and economic vitality for Bellingham and Whatcom County.

In this way, Habitat and KulshanCLT share very similar missions: support for long-term, affordable home ownership; creating neighborhood strength and stability; promoting environmental stewardship of the land and energy resources; and reducing the cycle of housing displacement caused by rent increases and market fluctuations. Together, Habitat and an innovative land trust like KulshanCLT, help homeowners become stewards of these resources that, in turn, leave an affordable-housing legacy well into the future.

“KulshanCLT was founded as a nonprofit organization in 1999,” said Dean Fearing, Executive Director, of KulshanCLT (pictured above). “Back in 1998-99 housing prices were starting to climb in Whatcom County. The founders of KulshanCLT saw community land trusts as a great way to keep homes permanently affordable.”

For 20 years, KulshanCLT has been helping first-time home buyers get into home ownership. Currently, they have 135 homes in their Trust, with 70 in the pipeline, including the homes being built with Habitat on Telegraph Road.

“Back in 2002, when our first home came into the Trust, you could still buy a nice house for $135,000,” said Fearing. “Our homeowners are people who’ve always known that they wanted to put down roots in the community. But they also understand that without some kind of help, they’re never going to get into home ownership. They know they can never save up enough money for a down payment.

“The way the community land trust model works for housing, we leverage down-payment assistance from the city, state, and federal government that we bring into the purchase price of the home,” continued Fearing. “That’s the down-payment piece. It’s roughly $75,000 to $100,000 that we bring in to help somebody buy a home, which makes the home affordable to that buyer.

“Our requirements include that buyers must be at 80% or less area-median income (AMI), which is adjusted for family size,” continued Fearing. “Potential home buyers can’t have owned a home in the last 3 years. They need to have lived in Whatcom County for at least a year. Those are the main requirements.” (For more details about how to qualify and apply to the KulshanCLT program, how to contact their offices, or how to donate to KulshanCLT, please visit Kulshan Community Land Trust.)

When the home purchase is finalized, KulshanCLT takes title to the land, and the homeowner takes title to the home. “There are 2 separate tax parcels at that time,” said Fearing. “That’s the unique piece to a community land trust. When we take title to the land, we create a ground lease for the homeowner, and that ground lease is the key component. It protects the homeowner and their interests, it protects KulshanCLT and our interests, and it protects the lender and their interests.”

Ultimately, this unique arrangement means that a given home will remain affordable to future home buyers, creating a legacy of affordability.

“Our program helps people get into home ownership who are otherwise priced out,” said Fearing. “And they continue to be homeowners even after they leave our program.”

The demand for affordable homes today is enormous. It concerns Fearing that people are being forced to move away from this area because of the shortage of affordable housing. “My goal in 2020 is to do a big evaluation in how we can grow our capacity. We want to be able to start adding 25 – 50 homes a year instead of 2 – 5, which is what we’ve been doing,” said Fearing.

The telegraph Townhomes Project
Telegraph Townhomes Project

How did KulshanCLT and Habitat come to join forces to create more affordable housing? “When I became Executive Director of KulshanCLT in 2010, we had some county funding that we needed to spend down. So I approached John Moon (Executive Director, Habitat for Humanity in Whatcom County) about partnering on some of the homes Habitat was building in Ferndale,” said Fearing. “So, we were able to bring in our down-payment assistance and essentially purchase the land from Habitat, and that gave Habitat some cash to build their next home. And that worked really well on the 8 homes we partnered on.

“That solidified this relationship,” continued Fearing. “John found the Telegraph Road property. KulshanCLT was able to leverage the funding to buy it. What we realized at that point was that KulshanCLT can leverage funds to buy and own the land because that’s something we do really well. And Habitat can build the homes and leverage their resources. At that point, it seemed like a great partnership.”

The mixing of the two approaches to building affordable housing has, in turn, created more vibrant neighborhoods. “You have income ranges that go from 30% AMI maybe up to 130%. We’re not building ‘low-income’ developments. These are amazing places where people want to live. This partnership strengthens both of our organizations and missions so that we can help more working families.

“We’re seeing that already at Telegraph,” continued Fearing. “We’re cutting our teeth on these first 8 units. But when the next 4 start being built, and then the next, we’ll have a model that’s solidified so that we can really scale up in a big way.”

[Every cash gift we receive at Habitat, no matter how small, returns when each Habitat home buyer makes their monthly mortgage payments. This enables us to purchase more supplies for another home. Habitat’s core value, “a hand-up, not a hand-out,” means that every penny is repaid. Please consider pledging $5 per month.]

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