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.
That's when they met Community Housing Capital (CHC) at a 2017 NeighborWorks® Training Institute. "They spent the time to understand our vision and mission, in addition to helping us solve this problem, they also advised us on other projects we are planning in the future," said Sherrie Arey, Executive Director of NeighborWorks Great Falls.
CHC's $2,830,000 line of credit with a 90% LTV enabled them to acquire the land in June 2018. Seventy-seven single-family homes are planned for the parcel, fifty of the homes will be designated as MSH homes and will be constructed in groups of ten over the next five years. The first ten families started building their homes in the summer of 2019. The rest were sold at market prices to help subsidize the overall project. "CHC worked hard to structure a loan for us that was key to making it all come together," said Arey." Going forward, we plan to include them in the early planning stages of our projects."
NWGF is the top producing MSH home provider in Montana, with 117 owner-built homes to-date. An applicant's income can be no higher than 80 percent of area median income. They must have a favorable or curable credit history, two years of dependable income, and the ability to commit 30 hours per week for 12 months. No one moves in until each group of ten homes is complete. "This is not a hand-out or a free house," said Arey. "There is a mortgage, and with the time and effort involved, it is much harder than someone else who has the means to go out and buy a house. Our goal is to get hard-working people in housing that doesn't exist in Great Falls anymore," she added.
The Med Tech Park site is in a developed residential area of Cascade County, on the eastern edge of Great Falls. The vacant land is within a mile of major employers, including the University of Providence, Great Falls College MSU, the Centene Corporation, and Benefits Hospital. Malmstrom Air Force Base is only 8.5 miles northwest of the site and the presence of the base, with over 4,000 personnel, increases the need for affordable housing.