Market's tough for affordable housing, too
A recession only increases demand for less-pricey homes and apartments, so affordable-housing builders aren't used to downturns affecting their line of work. But no one nowadays is avoiding the ripple impact of tight credit and tightfisted investors.
"While it always has been challenging to do affordable housing, it's even more so today," said Chickie Grayson, president and chief executive of Enterprise Homes, the building arm of affordable-housing giant Enterprise Community Partners.
You can read about it in my story today, which explains how the credit crunch is decreasing the number of affordable rentals under construction and making it more difficult for groups to sell homes aimed at moderate-income workers.
Who qualifies for partially subsidized affordable housing, assuming there's any to be had? It depends on the program, but some homeownership efforts let you buy if you're making no more than 80 percent of your area's median household income. Around here, that works out to $44,800 for a one-person household, $51,200 for two, $57,600 for three and $64,000 for four.
That's the limit for eight "green" townhomes built by the Brooklyn and Curtis Bay Coalition, which says higher down payment requirements and tougher loan qualification rules have kept interested people from becoming buyers.
The homes have been finished since December, and the coalition has contracts -- not closed sales -- on just five of the eight. It quickly sold homes it rehabbed between 2002 and 2006, so it's not used to a prolonged wait.
This particular project started as a block of boarded-up homes, bought by the group at the end of 2003. The homes were in such bad shape that organizers decided to tear down and build new, said executive director Carol K. Eshelman.
And also build green, something that was a lot less talked about then. These homes have "living" roofs planted with sedum, solar panels (one each) that heat the water, a rain barrel in every back yard, dual-flush toilets and lots of insulation to cut down on drafts. The idea is much cheaper heating and cooling costs, so the homes will be more affordable to maintain.
The nonprofit group had to get construction financing like any other developer. Local and state government funding in the pot is what's allowing the coalition to offer the homes for $152,000 even though the cost was close to $250,000, Eshelman said.
"I really thought, 'This has been the hard part -- getting the financing together, putting the deal together, building the houses,'" she said ruefully.