South Bend community land trust, first of its kind in Indiana, is poised to grow

Jordan Smith, South Bend Tribune
·4 min read
At left, a single-family home on St. Louis Boulevard was the first sold through the community land trust established by the Northeast Neighborhood Revitalization Organization. Appraised at $500,000, it sold for $105,000. The neighboring home sold for nearly $700,000.
At left, a single-family home on St. Louis Boulevard was the first sold through the community land trust established by the Northeast Neighborhood Revitalization Organization. Appraised at $500,000, it sold for $105,000. The neighboring home sold for nearly $700,000.

SOUTH BEND — A unique homeownership arrangement in the Northeast Neighborhood that keeps prices affordable to lower-income buyers is poised to grow.

The University of Notre Dame on Tuesday announced it donated several plots of land south of campus where the Northeast Neighborhood Revitalization Organization will build a single-family house and two duplexes as part of a new community land trust — the first of its kind in Indiana.

Upon agreeing to become members of the land trust, lower-income folks can buy an inexpensive house while paying a small fee to lease the land on which it sits. By paying only to lease the land, entry-level buyers can afford to live in an area where real estate prices have soared among the wealthier Notre Dame crowd.

The land is owned collectively by trust members, who form a nonprofit corporation with other community leaders to keep down prices in perpetuity.

The neighborhood organization will partner with South Bend Heritage Foundation to build the new homes, which will sit along the east side of the 700 block of Turnock Street, near South Bend Avenue.

Eligible buyers generally must earn less than 80% of the area median income, or about $66,000 a year for a family of four. If they choose to sell the home, they must agree to do so at a restricted price, claiming only the value of improvements to the structure itself.

SBHF will also build a small fourplex to serve as affordable rental housing on a fourth lot on Turnock Street. SBHF previously partnered with the NNRO to build the Triangle Neighborhood, a mixed-income development east of Eddy Street with more than 50 homes.

South Bend Heritage Foundation Executive Director Marco Mariani speaks during an open house Friday, May 20, 2022, at Hoose Court Homes in South Bend.
South Bend Heritage Foundation Executive Director Marco Mariani speaks during an open house Friday, May 20, 2022, at Hoose Court Homes in South Bend.

Marco Mariani, SBHF's executive director, said the idea for the land trust arose when the neighborhood organization could no longer compete with private-market bids for land near campus. With developers lured by home sales prices that routinely exceed $1 million, acquiring lots for affordable housing became difficult.

"Because of that proximity to Notre Dame, people are willing to pay a premium to be there," Mariani said. "There are certain private developers who have tried to seize on that energy."

But by using federal and state money allotted to support lower-income housing developments, Mariani said, SBHF will build new homes and sell them at a discounted price to entry-level buyers. The lots on Turnock Street will go to five new land trust households.

Last year, the NNRO sold its first home through the land trust on St. Louis Boulevard, a block west of the lots on Turnock.

The 3-bedroom single-family home was sold for only $105,000, though it cost $300,000 to build and its appraised value was roughly $500,000. A larger home next door recently sold for about $700,000.

“Nobody's getting rich in this," Mariani said.

Mariani said land trusts "counteract the private market-impulse to get as much as you can on a home sale transaction." In turn, neighborhoods become more socially and economically diverse.

“Everybody deserves a chance to be a part of what's great about a community and what's great about a neighborhood," Mariani said, noting that the Northeast Neighborhood is within walking distance of campus, downtown South Bend and Eddy Street Commons. "That should not just be available to people that make a certain amount of money."

Notre Dame last year donated four other lots along Turnock Street and $250,000 to Habitat for Humanity of St. Joseph County, another organization that sells homes to lower-income buyers. Together, the gifts could allow Habitat to build as many as seven new homes in the neighborhood over the next five years, according to a Notre Dame press release. Two homes are nearly finished and are owned by single fathers from South Bend.

The NNRO worked with a California-based consultant called the Grounded Solutions Network to establish the community land trust.

There are about 250 such land trusts across the U.S., according to the consultant. The arrangements aim to create communities that are permanently affordable for generations of lower-income families, who are often priced out as growing neighborhoods attract wealthier residents.

Email South Bend Tribune city reporter Jordan Smith at JTsmith@gannett.com. Follow him on X: @jordantsmith09

This article originally appeared on South Bend Tribune: South Bend's community land trust is first in Indiana