Special Report: Workforce Housing
Whether tapping into credits, tax reductions, or special employee incentives, reducing the financial burden on buyers calls for innovation and flexibility.
While approaches to workforce housing must vary by region and even by city, most successful projects stay in the black by tapping numerous funding sources and partnering with nonprofits and (less frequently) private enterprise. To get started sooner rather than later, you may want to work through organizations (such as local housing authorities) that can navigate the intricacies of funding and paperwork inherent in affordable housing projects. In some cases, city planners are taking the initiative, so don't miss your chance to jump in and make alliances.
TOOL 1: Strings Attached
Down-payment gift programs help cash-poor buyers purchase a home, but others wonder about the long-term cost to the housing market.
For builders who do entry-level or affordable product, down-payment gift programs can close the gap for buyers with steady incomes but little cash. The process typically works like this: A buyer qualifies to buy a home but falls short of the required down payment. He or she then goes to a down-payment assistance organization, the most well-known of which is the Nehemiah Program, which gives the buyer a grant (usually between $2,000 and $5,000) that is used as the down payment. The builder then makes a contribution in that amount plus a small service fee.
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