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Expansion of Homeownership Opportunities
Preferences ||| Conditions ||| Activities
These activities expand homeownership opportunities and strengthen current neighborhoods through encouragement of affordable owner-occupied housing, home buying, and expansion of ownership/tenure options. These activities generally help improve both the affordability for purchase by moderate income homebuyer households and/or the physical status of the housing stock available to first-time homebuyers. The activities include various forms of alternative ownership such as rent-to-own, land trusts, self-help or downpayment subsidies, or renovation of housing stock for purchase. These activities address Objective A2 in the Five-Year Plan and are generally targeted to those households in the 50-80% of median range. The long-term target goal is to maintain or increase the rate of homeownership in the lower income non-University neighborhoods to 90% of the Citywide average for ownership. The national benchmark for ownership is a 65% average.
The Commission will fund activities that acquire, construct or rehabilitate properties which will be re-sold to qualified low or moderate income homebuyers. (A "qualified homebuyer" is defined as one who has not owned a home or property within the last three years.)
The 1999 City objective is to help at least 57 households move into affordable ownership positions.
For information on how to submit a proposal in this category, click here.
The Commission will give preference to activities which increase ownership opportunities within the CDBG Target Area, are designed to assure housing affordability over time, provide housing for re-sale to persons at less than 60% of median income, or incorporate accessibility requirements into the project design.
The sale price to the LMI buyer, of any assisted property, shall not exceed the HOME assessment limit as established by HUD.
Housing (after rehab) shall comply with all applicable State and local minimum housing and building codes.
Proposals will be limited to receipt of $37,500 per housing unit. This sum will include the total CDBG and/or HOME funds received.
Activities may not exceed a total loan (or other secured funds) to value ratio greater than 115% from all sources. (NOTE: The CDBG Office will give consideration to higher per unit amounts or percentages when the proposal meets the preferences stated above or is temporary financing to reduce holding costs.)
A minimum of 85% of all funds received shall be applied to capital costs including acquisition and closing costs, rehabilitation, labor and materials, design and engineering costs and relocation costs. A maximum of 15% of the total CDBG Office funds received may be applied to staffing and other service delivery costs. Activities involving the training of lower income individuals and which lead to employment or higher education may apply up to 50% of funds to staffing, legal or other development associated costs.
The CDBG Office shall secure capital assistance with a mortgage in the form of a recourse loan. The mortgage will require a repayment equal to the amount of CDBG or HOME funds invested, or the percent of appraised value which the CDBG or HOME funds represent in the value of the property, whichever is higher.
Ongoing / currently funded activities in this category include:
City CDBG: Housing Development Fund (Homeownership)
Operation Fresh Start: Employment and Training through Rehab
Urban League of Greater Madison: Single Family Rent-to-Own Program
City Community and Economic Development: Home-Buy
Common Wealth Development: Affordable Homeownership
Habitat for Humanity: Development of Low Income Owner Housing
Movin' Out, Inc.: Homeownership Program