A National Community Development Financial Institution (CDFI)Flexible Loan Capital Customized to Create Affordable Housing
Homeownership
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Nearly half of Atlanta residents are housing cost-burdened, spending over 30% of their income on housing costs. In some neighborhoods on the south and west sides of the city, more than 70% of residents are housing cost-burdened. With a $3 million acquisition loan from Community Housing Capital, the Atlanta Neighborhood Development Partnership (ANDP) will purchase and rehab 20-25 single-family rental homes over the next two years. Fifty percent of the homes will be leased to households earning 80% of Area Median Income (AMI) or below, with the flexibility to rent the remainder to households earning up to 120% of AMI. Average rents are expected to be as low as $1,250 per month, well below 80% AMI rent maximums of $1,724.
Much of Atlanta’s existing affordable housing is in single-family rentals. As non-local institutional investors purchase single-family homes for rent, they often act as absentee landlords or start flipping houses and displacing low- and moderate-income residents. ANDP believes that nonprofit ownership of single-family rentals is critical to slow gentrification while alleviating some of the overwhelming affordability issues in the Atlanta area. In year two of their Closing the Gap initiative, ANDP is on an unprecedented five-year campaign to build or preserve 2,000 affordable housing units in metro Atlanta. In the next three years, ANDP aims to grow its portfolio of affordable single-family rentals to over 300 homes and to sell 25-35% of the homes over the next ten years to homebuyers earning 60% AMI. To support ANDP’s initiative, CHC structured the $3 million loan as a 7-year facility, with two years of interest-only payments that will allow for stabilization of the homes as they transition to affordable rentals.
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Avenue CDC is one of five non-profit recipients of Community Housing Capital’s (CHC) $30 million New Markets Tax Credit (NMTC) allocation. With a $5 million NMTC allocation from CHC, Avenue CDC plans to build approximately sixteen affordable homes at three different sites in the Northline community of Houston, Texas. CHC’s NMTC allocation and source loan will allow Avenue CDC to sell the homes at a lower price while not sacrificing construction quality.
Avenue CDC’s mission to provide affordable homeownership opportunities in Houston’s high-cost market has been challenging. The highly distressed census tracts they revitalize through affordable new home construction experience a poverty rate as high as 35.30%, an area median income (AMI) as low as 41.65%, and an unemployment rate as high as 11.70%. Avenue CDC’s proposed average sales price of $265,000 is below most of the maximum mortgage amounts at even the 80% AMI level, making the proposed homes affordable for many homebuyers of varying family sizes.
Avenue CDC will provide pre-purchase financial counseling, homebuyer education, realtor services, and post-purchase counseling and support. Qualified homebuyers earning up to 80% AMI can also use city and county down payment assistance programs that offer up to $30,000 and include 0% interest and forgiveness after five years of occupancy.
Created on 22 April 2022
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In November 2021, Community Housing Capital provided a construction loan of $450,000 to Neighborhood Housing Services of New Britain (NHSNB). The loan will fund the simultaneous construction of three, affordable single-family homes just 2 miles east of downtown Bristol, Connecticut. In an area that has seen decreasing rates of homeownership in the last decade, the actual costs to build the 1,130 square foot homes are approximately $385,000 each.
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NeighborWorks® Great Falls (NWGF) has used its successful Mutual Self Help (MSH) program to help families build their own affordable homes in Great Falls, Montana since. 2005. However, they were in danger of running out of land to build on. It had happened five years earlier when they had to suspend the program for lack of affordable, vacant land. With over 150 families on the waiting list, NWGF was searching for a solution.
In Montana, new-home construction in the Great Falls area exceeds $300,000 per home, and undeveloped land goes to the highest bidder. NWGF was fortunate to find a seller willing to work with them to purchase an undeveloped, 18.5-acre parcel of land known as Med Tech Park. Even though the seller gave them a very favorable price for the parcel, they weren't sure how they would fund the total project.
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Community Frameworks initiated the “Built in Bremerton” program to help eliminate foreclosed, vacant, and distressed single-family homes in Bremerton, Washington. Through this acquisition-rehab sweat equity program, they have completed the rehabilitation and sale of 21, affordable, energy-efficient homes since 2013. Eleven of the homes were financed by Community Housing Capital (CHC) with a revolving $1 million line of credit.
The scattered-site rehabilitation program has been very successful and widely supported by the community. “In one neighborhood, we completed four homes on the same street and people really noticed,” said Heather Wegan, Affiliate Services & Homeownership Manager for Community Frameworks. “The activities there have not only inspired additional private investment and pride in ownership from other residents, but it has also contributed to a sense of community in the area.
- Fund created to renovate blighted, scattered-site, single-family properties in New Jersey
- NPH attracting higher-income professionals to live full-time on tribal lands
- Over $21 million invested in new single-family construction since 2009
- Developing quality, affordable housing in Boulder, CO, so working families can afford to live there