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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 active activities include various forms of alternative ownership such as rent-to-own, land trusts, self-help, downpayment subsidies, construction of new units, or renovation of housing stock for purchase. These activities address Objective B 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 68% 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 2004 City objective is to help at least 67 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, or incorporate accessibility requirements into the project design.


Funds may be used only for housing units which do not exceed the HOME purchase price or value limit designated by the Federal Department of Housing and Urban Development (HUD). CDBG staff may allow for individual exceptions in cases involving hardship.

Housing (after rehab) shall comply with all applicable City 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. NOTE: The CDBG Office will give consideration to higher per-unit amounts or percentages when the proposal meets the preferences stated above, involves lead paint hazard reduction, or is temporary financing to reduce holding costs. These higher amounts, up to $5,000 per unit, will be evaluated based upon activity "need" and availability of resources.

Activities may not exceed a total secured funds-to-value ratio greater than 115% from all sources. NOTE: Projects where a community land trust serves as owner of the underlying land will be permitted to meet a higher ratio of 125% (secured funds-to-value ratio for the entire project of land and property, or 150% of secured funds-to-value ratio for the land alone), if the ground lease meets the conditions of affordability and 100% of the full value of the land is secured by a mortgage to the City.

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 its funding for capital costs with a mortgage in the form of a recourse loan. Funds will be provided in the form of a long-term deferred loan, payable upon sale of the property or change in the use of the property. 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:

Continuing activities approved in prior years include Habitat for Humanity's Development of Low-Income Owner Housing, C-CAP's Northport Commons Housing Development, Movin' Out and Wisconsin Partnership's Twin Oaks Housing Development, and Madison Area Community Land Trust's Troy Court, Troy Gardens and Camino del Sol projects.

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About the Community & Neighborhood Development Program
Currently Funded Activities ||| Results
Proposal Qualifications and Process
Materials Available from Us ||| How To Contact Us