Programs for prospective homeowners vary from down payment assistance to help with closing costs.
Money aimed at first-time home buyers also comes from a variety of sources, which can make navigating for the right program a headache. For some programs, income guidelines look at a family of four making $46,000. Other programs allow more flexibility in income levels.
Sherry Kinzie-Harris, Central Minnesota Housing Partnership, said the agency is working to try to exceed a level imposed to access lower interest rates for first-time home buyers. The catch is that homes may not exceed a purchase price of $76,500, which is becoming a challenge as city housing prices continue to climb. Demand for houses is likely to continue that trend.
The Initiative Foundation identified wealth or personal asset creation as a priority for the current fiscal year. And the foundation noted that studies indicate a widening gap between those who are and are not benefiting from the current economic boom. Home ownership is one way for individuals to accumulate assets for the future.
In addition to single-family homes, affordable apartments in good condition are also an area need. Three-story apartment buildings, such as the South Haven Garden Apartments in southeast Brainerd, may be more of an option in the future. (Dispatch Photos by Renee Richardson)
Affordable housing is often listed as a major barrier to a stable work force.
BYLINE1:By RENEE RICHARDSON
Two substantial housing related grants could begin to change the Brainerd landscape before Christmas.
For some prospective home buyers, the news could be like a present.
Grants in the total amount of $521,173 were awarded in low-interest loans or money to buy and renovate homes in need of repair and updating. The Southeast Brainerd Initiative looked at starting such efforts in that part of the city because of a combination 70 percent rental units and an active and organized residents association there.
An award from the Community Revitalization Program came in the form of a $268,000 low-interest loan. The funds will be used to acquire and convert four rental properties into single-family homes. As the home loans are paid back, the dollars will be converted into a revolving loan fund to be used by future first-time home buyers.
A grant in the amount of $253,173 will be used to acquire and renovate single-family properties in need of repair.
"I would suspect, in the next six months, you are going to see the direct result of this money," said Sherry Kinzie-Harris, Central Minnesota Housing Partnership.
The housing partnership is serving as the fiscal agent and key consultant. A Minnesota Housing Partnership volunteer from the Volunteers in Service to America program will be the project coordinator under the supervision of the Brainerd Housing and Redevelopment Authority.
Kinzie-Harris said one of the partnership's goals is to get affordable mortgages and provide a central spot for information on available homeowner assistance.
Existing homes set for renovations and resale with the grant money will be sold below a required $76,500 level in order to create affordable monthly house payments. Kinzie-Harris said the challenge for affordable housing and the high percentage of substandard homes identified in a 1990 inventory were some of the driving factors leading to the Brainerd grant awards.
A 1990 Brainerd HRA inventory of 3,494 homes found nearly half, at 47 percent, to be substandard or dilapidated.
Doug Grout, HRA executive director, said the plan is to conduct a new housing study for the entire market area every three to four years. The greatest analysis is expected after Census 2000 numbers are available. Grout said a study for 2002 is likely to have the best numbers.
"Our market has changed a lot since 1996," Grout said.
A Crow Wing County Housing Study was completed in 1997 through the efforts of a task force and created pages of information from annual incomes to housing needs. Even with the amount of information generated, Grout said it was difficult to find support for the study.
Currently, the area has a need for a mix of affordable rental units and affordable housing to buy. Some existing homes are almost too small to be marketable. Grout said there are options to build houses designed to provide space on narrower city lots.
For the lakes area another challenge will be finding builders willing to take on city construction projects, especially for the idea of replacing declining homes with new ones. An added bonus is homes that are energy efficient so new owners can buy them without an immediate cost to replace roofs, furnaces and other budget killing repairs.
Moving renters to the investment of home ownership is one goal. Creating affordable and decent rental options is another.
Statewide the rental average in communities is 28 percent. In Brainerd, the rental population is about 50 to 55 percent. Grout noted the lakes area's development as a regional hub means recognition that more renters than the state average may be part of the equation.
"I don't think there is anything necessarily wrong with that," Grout said. The Brainerd HRA is also expecting to serve as a place where people moving to the area or existing residents can find a comprehensive list of available housing and information on developments in the next six months.
Grout said there will be more housing built and more rental housing. More of a focus on single-family homes with affordable mortgages is part of the plan. Families or single people with an annual income of $27,000 to $30,000 can find an $80,000 mortgage a challenge once mixed with other demands on paychecks.
Mixed neighborhoods of varying income levels and home ownership and rentals is an ideal with developments not looking like they were built with a cookie-cutter design. In the late 1980s and early 1990s, Grout said the idea was to construct rental units with a town house style. But the price per unit to develop can be $100,000 and higher. Grout said the movement is getting back to looking at three-story garden level apartments.
In addition to new developments, Grout said revitalizing core areas is an important aspect. New housing options are also being used in other cities to fit housing space needs on narrow city lots.
"Those are all opportunities," Grout said. "This is a great time to be here. ... We've got good healthy growth. ... Smart growth is the buzz. We're going to have to determine locally what that means. I think it means just putting a little thought into it."
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