Land, Wealth & Power: How Land Structures Shape Generational Security

Land, Wealth & Power: How Land Structures Shape Generational Security

Historical and policy barriers from redlining to discriminatory lending have disproportionately blocked Black households’ access to that pathway. To truly deliver on land as a source of generational wealth, structural reforms are necessary to secure ownership, limit predatory practices, and strengthen community control.

Ground Rent: Hidden Risk in the Leasehold System

One understudied barrier to land-based wealth accumulation is the ground rent system, notably in Maryland, Pennsylvania, and Virginia. Under a ground lease or leasehold arrangement, the homeowner owns the building (improvements) but not the land: a ground rent holder retains ownership of the land, and the homeowner must pay periodic rent. (Whiteford Law+2Maryland State Archives+2)

In Maryland, thousands of households remain subject to this structure. The state’s Department of Assessments & Taxation (SDAT) registry shows that tens of thousands of properties especially in Baltimore City are tied to ground leases. Maryland General Assembly Homeowners must pay ground rent (often $50–$150 per year) on semi-annual or annual schedules, but failing to do so can carry serious legal risk. (LegalClarity)

Baltimore holds a central place in the history of racist housing policy in the United States. In 1910, it became the first major American city to pass a residential segregation ordinance, laying the blueprint for later forms of racialized land-use control. Although the Supreme Court struck down explicit racial zoning in 1917, Baltimore’s approach quietly evolved into a new system of exclusion: racially restrictive covenants, biased appraisals, and ultimately the federal HOLC “redlining” maps of the 1930s. These practices exported Baltimore’s model nationwide, shaping urban development in nearly every major U.S. city and locking generations of Black families out of homeownership and wealth-building opportunities. Because the problem originated through local policy and spread outward, meaningful local solutions have the potential to follow the same path.

If Baltimore and other cities with similar histories successfully implement transformative strategies such as community land trusts, targeted anti-displacement protections, or ground-rent reform, those models can once again ripple outward, but this time as vehicles for equity rather than exclusion.

Historically, nonpayment could result in ejectment (forcible removal from one’s home), a deeply destabilizing outcome. (Whiteford Law+1) Although reforms in 2007 curtailed some of this power adding a 60-day cure period and greater procedural protections the system still exposes homeowners to risk. (Maryland State Archives)

One complexity is that only registered ground leases are legally enforceable. If a ground lease isn’t properly recorded in SDAT’s registry, ground rent holders lose certain enforcement rights, including the ability to sue for unpaid rent. (Justia Law) Moreover, homeowners may be eligible to redeem or buy out their ground lease to extinguish the obligation through structured formulas based on the rent amount and the lease’s original capitalization rate. (People's Law Library) Maryland even offers a Ground Rent Redemption Loan through its Department of Housing & Community Development to fund that buyout. (Maryland Housing Department)

The system creates both financial and legal opacity. It can be difficult to trace who owns the ground rent and enforceers may change without clear notice. (LegalClarity) Homeowners report confusion when the listed landlord is unresponsive or when demands for payment surface after years of quiet.

Because the ground rent obligation is separate from mortgage or tax statements, and because some leaseholders may not be transparent, it’s possible for homeowners to straddle hidden liabilities potentially threatening their financial stability and complicating refinancing or resale.

Risks to Generational Wealth and Stability

Ground rent arrangements fundamentally undermine the typical route to accumulating equity:

1. Priority and Risk of Loss: Ground rent holders often have enforcement rights (though reforms have limited extreme outcomes), increasing the risk of foreclosure-like outcomes.

2. Limited Equity Capture: Even when leaseholders redeem their ground rent, the formula may undervalue future land appreciation, limiting their ability to capture long-term value.

3. Title Uncertainty: Unregistered leaseholds or misattributed ground landlords can create legal ambiguity that dissuades buyers, complicates resale, and reduces generational transfer.

4. Disproportionate Impact: Because ground rent properties are clustered in legacy urban neighborhoods (e.g., Baltimore), the risk is concentrated among lower and moderate-income homeowners, including many Black families.

Thus, while land ownership promises generational wealth, leasehold systems like ground rent pose structural dangers particularly in communities with limited legal or financial resources.

Land Banking: A Strategic Tool for Stabilization

One promising solution to land decay, disinvestment, and fragmentation is land banking. Land banks are quasi-governmental or nonprofit entities that acquire, manage, and repurpose vacant, tax-delinquent, or abandoned land to ensure productive use rather than letting properties stagnate.

The Cuyahoga Land Bank, serving Cleveland and Cuyahoga County, provides a powerful case study. Since its founding in 2009, it has:

• Demolished nearly 10,000 blighted structures, removing safety hazards and clearing the way for new investment.

• Renovated over 2,600 homes, contributing to a nearly $950 million increase in property values.

• Facilitated the construction of ~250 new homes, generating about $143 million in added value.

• Restored over $48 million in annual property tax revenue by returning properties to productive use.

• Spurred more than $395 million in private investment over 15 years.

• Generated an estimated $3.6 billion in total economic impact. (Cuyahoga Land Bank+1)

Empirical studies underpin land banks’ effectiveness. A Federal Reserve Bank of Cleveland working paper found that acquiring and removing distressed properties through the land bank reduced negative property value spillovers in nearby homes helping stabilize and retain value in the broader neighborhood. Cleveland Fed

These data suggest that land banks are not just reactive holders of blight: they actively restore value, catalyze investment, support redevelopment, and provide opportunities for community-led revitalization.

Empowering Black Communities through Land Tools

Beyond land banking, other policy tools have proven effective in helping Black residents gain control over land, preserve long-term affordability, and build generational wealth.

1. Community Land Trusts (CLTs):
   CLTs separate land ownership from homeownership: the trust owns the land in perpetuity while individuals own the homes built on it. This structure helps prevent speculation and ensures lasting affordability. (Brookings) The New Communities, Inc. trust (founded in Georgia in 1969 by civil rights leaders, including Slater King) is a seminal example. It provided secure land tenure for Black farmers at a time when discrimination and forced evictions were rampant. Today, CLTs are increasingly used in urban contexts to help historically marginalized communities remain rooted and retain wealth.

2. Right of First Refusal & Community Purchase Rights:
   These mechanisms give community organizations or residents priority to buy land or homes when they go up for sale, limiting predatory flips and outside speculation.

3. Targeted Homeowner Support Programs:
   Programs that provide legal assistance, tax relief, or mortgage counseling can reduce foreclosure risk. Coupled with land banking, such supports allow existing residents to stay in their homes even amid redevelopment.

4. Zoning / Land-Use Reform:
   Inclusionary zoning, zoning reform, and anti-displacement policies can help existing residents shape the trajectory of neighborhood growth rather than watching profits flow to outside developers.

Challenges & Pushback

While these strategies hold promise, they come with real challenges:

• Financing & Mortgage Access for CLTs: Some potential homeowners report difficulty securing traditional mortgage financing because the trust-owned land complicates collateral valuation.

• Scalability: Not all municipalities have the legal or financial capacity to run a land bank effectively; funding for acquisition, demolition, or rehab is often tight.

• Gentrification Risk: Without anti-displacement mandates, redevelopment from land banks or other initiatives could inadvertently price out longtime residents.

• Political Resistance: Leasehold reform (such as ground rent redemption) may face pushback from existing ground rent holders, many of whom have held these interests for decades.

To address these concerns, policymakers must pair structural reforms with strong community governance. For example:

• Land banks should adopt anti-displacement mandates, partnering with CLTs or community development corporations (CDCs) to ensure long-term affordability.

• Ground rent buyout programs must remain accessible and well-funded, with legal support for homeowners navigating redemption.

• CLTs should advocate for mortgage products tailored to their structure, while educating lenders about the long-term stability and community benefits of trust-held land.

Conclusion: The Power of Land Stewardship

Owning a home is more than a personal asset. For many, it represents a multigenerational legacy. But legacy can be fragile. Instruments like ground rent can jeopardize that stability, especially in legacy Black neighborhoods, while vacant and underutilized land can undermine community value and cohesion.

Land banks and community land trusts offer powerful models for reimagining land as a shared asset, not a speculative commodity. When designed with equity, transparency, and community control in mind, they can help preserve generational wealth, provide durable affordable housing, and give Black residents and other marginalized communities real influence over the land beneath their feet.