Man holds young girl in front of house

An accessible path to home ownership

A Richmond, Virginia, housing organization has found a way to keep homes affordable — while securing an accessible path to homeownership for future generations.

Rising real estate prices have put homeownership — and the wealth-building opportunities that come with it — out of reach for many Americans, a gap that has contributed to growing economic inequality across the United States. For families of diverse backgrounds, the challenges are even more acute. “Rapidly increasing home prices, tightening credit requirements and the need to save for a down payment are the most significant barriers for buyers of color,” says Erica Sims, chief executive officer of the Maggie Walker Community Land Trust (MWCLT) in Richmond, Virginia, where Black families in particular have seen their homeownership rate drop in recent years.footnote1

Making affordable homes available to working families, all while keeping Richmond neighborhoods diverse and vibrant, is the trust’s mission. The organization employs an innovative model to make homeownership accessible to low- and middle-income residents who might otherwise be priced out of the area. The trust builds or rehabs homes and then is able to sell them at below-market rates by retaining ownership of the land beneath the homes. The buyer is only purchasing the building itself. This lowers the initial down payment and monthly mortgage payments, while still allowing the buyer to build equity in their home over time.

In exchange for the lower purchase price, buyers must agree to cap the home’s sales price based on the median income in Richmond if they later decide to sell, keeping the home within reach for the next owner. It’s a model that benefits the entire community, guaranteeing an ongoing supply of affordable housing. “The goal is to provide a hand to homeowners so that they can build wealth, but also ensure that the home remains affordable enough to serve countless future community members,” Sims says. Since launching in 2016, MWCLT has provided 58 homes in the Richmond region, with an average sales price that’s 54% lower than the Richmond metro average.

Through support from Bank of America, as part of its  commitment to advance racial equality and economic opportunity, the trust aims to expand homeownership opportunities through targeted financial education programs, with the goal of increasing the pipeline of new owners of diverse backgrounds to 60%, up from 45% today. It’s a fitting tribute to Maggie Lena Walker, the trust’s namesake, who was the first Black woman to establish a bank in the United States. “In her name, we work to ensure that the communities of the Richmond metropolitan region are diverse and inclusive, with safe, attractive, affordable and sustainable housing choices for all people,” Sims says. In 2021 Bank of America also donated a financial center to the land trust, along with funding for a study to determine how the building could best be used to benefit the community.

Richmond Regional Housing Framework,” Partnership for Housing Affordability, 2020