Others may have an ample supply of affordable homes but need to revitalize them to stimulate economic opportunity in some neighborhoods or preserve their endangered stock of affordable rental apartments. Whatever the circumstances, preparation of a comprehensive housing strategy helps avoid a haphazard approach to implementation of solutions and enables communities to address the housing needs of residents and members of the local workforce in an effective and coordinated fashion.
Elements of an effective housing strategy include: (1) a needs assessment highlighting deficits in the local housing supply and resources available to address
Photo courtesy of McCormack Baron Salazar
Crawford Square, Pittsburgh PA -- photo courtesy of McCormack Baron Salazar
|The Rural Housing Service (RHS),
an agency in the U.S. Department of Agriculture, operates a broad range
of programs to support affordable housing and community development in
rural areas. RHS offers both direct loans and guarantees for mortgages
extended by others. Under the Section 502 program, loans help
low-income families purchase or rehab homes. The agency also operates
the Section 515 program which provides low-cost mortgages for property
owners to develop rental housing that is affordable to the lowest
income rural residents.|
Generate state or local funds. In addition to federal funds, many states and localities fund housing and community development from local revenue sources such as property taxes or general city or state tax revenue -- all of which have been affected by the economic downturn. Some communities earmark money from real estate transfer taxes to finance housing trust funds that, in turn, finance the construction or rehabilitation of homes. Some float general obligation bonds or use future tax revenues (tax-increment financing) to fund new housing efforts. Others levy impact fees on new developments as a way of funding some of the required infrastructure for new developments, including linkage fees on new commercial development. Click here to leave this section and learn more about generating additional capital for affordable homes.
Mobilize non-traditional partners. Faced with shrinking budgets, some communities are leveraging support for affordable homes in other ways. For
|Strategies to deal with these problems will differ from place to place, but much can be done to address these problems. Resources available nationwide, such as Low Income Housing Tax Credits and financing programs of the Federal Home Bank system, as well as state allocations of funding through the Community Development Block Grant and HOME programs, can be used to create more affordable homes in rural areas. The Rural Housing Service (RHS), an agency in the U.S. Department of Agriculture, operates the Section 515 program which provides low-cost mortgages for property owners to develop rental housing for the lowest income rural Americans. The agency also administers the Section 502 loan program to help low-income families purchase, build, repair, or renovate homes. Funds also may be used to refinance debts when necessary to help families avoid losing a home.|
Country Lane, Lakeville MN -- photo courtesy of LHB Inc.