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To preserve the affordability of homeownership units, someone must play an active stewardship role.
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Stewardship for Lasting Affordability Administration and Monitoring of Shared Equity Homeownership
Rick Jacobus Burlington Associates in Community Development
Stewardship Functions
Frates Square, Housing Land Trust of Sonoma County
Stewardship Functions
Stewardship Functions
Potential AgentsWho holds key responsibilities?
Minimal AdministrationNo Designated Steward
Santa Barbara CountyLocal Government as Steward
City of SalinasDevelopers Hire Private Contractor
Lafayette, COCity Hires Private Contractor
City of Palo AltoCity Contracts with Nonprofit
Tri-Valley HousingLocal Governments Form Nonprofit
Chapel HillCommunity Land Trust as Steward
Staffing and Revenue
MunicipalityShared Equity
Ownership UnitsEstimated staffing
(FTEs)Est. Units/FTE
Somerville, MA 41 2.5 16.4
Lafayette, CO 70 0.75 93.3
West Sacramento, CA 80 3 26.7
Palo Alto, CA 169 1.25 135.2
Housing Assistance Council of Cape Cod 250 0.25 1000.0
Boston, MA 400 3 133.3
Santa Barbara, CA 453 1 453.0
Bedminster Township, NJ 680 1 680.0
Denver, CO 700 1 700.0
Fairfax County, VA 1400 3 466.7
Montgomery County, MD 1976 6 329.3
NJ Housing and Mortgage Finance Agency 5000 10 500.0
Economies of Scale
Common Revenue Sources
• Local Government General Funds• Local Housing Funds• Application Fees• Refinance Fees• Marketing Fees from Developers• Resale Fees from Homeowners• Admin Fees/Ground Rent• Grants/Fundraising
Scalable Revenue
• Marketing Fees
• Resale Fees
• Admin Fees
Grows with Portfolio
Marketing Fees
• Workforce Housing Association of Truckee Tahoe– 3% of Affordable Sales Price
• Housing Land Trust of Sonoma County– $7,000 per unit
• City of Somerville, MA– $2,500 per unit
Traditional Realtor Commission = 6% of price
Charged to Developers at Initial Sale
Resale Fees
• Palo Alto – included in annual fee for service contract with City
• Tri Valley Housing Opportunity Center– $1,000 per sale (no marketing)
• Santa Clara, CA -NHS – ~$10,000 per sale (with marketing)
• State of New Jersey – 3% of Affordable Sales Price (with marketing)– 1.25% of Affordable Sale Price (without marketing)
Charged to Homeowners at Sale
Admin Fees
• Community Land Trust Ground Lease Fees– $20 - $100 per unit per month
• City of Chicago/Chicago CLT– “Covenant Fee” $25 per unit per month
• Urban Homesteading Assistance Board– Co-op Monitoring Fee $1,500 – 4,500 per
co-op building per year
Charged to Residents Monthly/Annually
Stewardship Costs
Sample Program Costs
Palo Alto - PAHC– $140,000/ 169 units ($828/unit)
• San Jose - NHS– $60,000/~ 125 units (~$500/unit)
• Montgomery County, MD – $400,000/1,976 units ($202/Unit)
Stewardship Costs
• We don’t have enough information to know what the right range of costs should be!
• Many programs are very significantly under funded
• Costs per unit seem to drop with volume (ie. There are significant economies of scale)
• Costs seem to increase with subsidy levels
Stewardship Costs
High Cost Lower CostMarket House Price 500,000$ 250,000$ Average Affordable House Price 325,000$ 150,000$ Value in Trust 175,000$ 100,000$
Budget for 300 Unit Program 240,000$ 135,000$
Stewardship Cost Per Unit 800$ 450$ Cost as % of Value in Trust 0.46% 0.45%
*Hypothetical values only
Relative to “Value in Trust”
