Loading...
Homeonwership HAB 5-25-2022Homeownership Programs We help people like the Sharma Family* $54,000 Annual Income from two nursing assistant jobs and Social Security. $3,600 in savings In need of stable housing that they can afford into the future. Stock photos - © Monkey Business - Fotolia.com * The information presented is based on a real family. The name has been changed to protect their identity The Sharma’s bought a permanently affordable home 3 bedroom, 2 bath, 1,200 sq ft condo $184,000 sales price $1,570 payment (35% of income) The covenant limits who can buy the home, how the home can be used, and limits the resale price. City staff qualified the family and ensured all the requirements of the program were followed during the sale. The family had some savings but needed more to close A $6,600 solution grant was provided to cover the gap in money they had and money they needed to close. The grant is not repaid. At resale, the home price is reduced by the grant amount. This makes the home more affordable to the next buyer. The future for the Sharma Family Room the family needed. Shorter commutes to jobs in Boulder. Stabilized housing costs (no more rent increases). A community where they can grow roots. Homeownership as an investment. $37,200 Estimated proceeds to the Sharma’s after five years of ownership. This represents the appreciation allowed per the covenant and principal paydown over five years. Homeownership Inventory Rental 3004 79% Ownership 811 21% Deferred payment second loan for market rate homes. Help with health and safety repairs for low-income owners. Low interest loan provided to pay costs. Additional Programs Residents designate their homes to become part of the Permanently Affordable program after they die. Shared Appreciation Loan Home Repair Housing Legacy Owner Satisfaction The results of a 2019 survey found: • 57% of owners were very satisfied and 34% of owners were somewhat satisfied with home. • 89% were glad they purchased / would purchase again. • 68% have had improved financial security since purchasing. • Most plan to stay in their home for the next 5+ years. Owner Challenges The results of a 2019 survey also found: • 49% have had surprises as a homeowner. • 65% say HOA costs have been higher than expected. • 29% say maintenance & repair costs have been higher than expected. Owner Challenges Common themes in the survey comments: • Increasing HOA fees effecting affordability. • Appreciation caps limit ability to build equity and move on/up. • Program restrictions. Shared Appreciation Loan Permanently Affordable MetroDPA Expanded income limits Expanded loan amounts Approximately 15% of inventory New purchase initiative Regional down payment program 5% forgivable loan Middle Income Focus What Works Well • Homes are affordable (half appraised value) • Lender and agent support • Permanently Affordable Covenant that has stood the test of time • Quality home spread throughout the city Current Challenges • Increasing Homeowner Association fees threaten affordability • Instilling a homeowner mind set • Managing homeowner expectations around appreciation • Serving middle income buyers • Program complexity Questions