Like Einstein, Newton and other pioneers of yesteryear, we search for the elusive formula, recipe or theory from which the answer to "affordable housing" will spring.
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Affordable housing is born from manipulating the market forces that create its need, by those who have nothing to gain from its creation, but experience, education and social equity.
Juneau needs a nonprofit corporation with a sole vision of creating affordable housing and an action-oriented board of directors hailing from local banking institutions; universities and high schools (building technology); youth services; correctional administrators; social services; city, state and federal officials; neighbors and an architect or two.
Here's a simplified scenario of an average project:
Our nonprofit corporation purchases an odd-sized lot needing variances to build upon. The nonprofit, in turn, works with the city for the needed variances and the volunteer architect for the most efficient design.
Materials are ordered at the same time (at a bulk discount) and purchased with a low-interest loan provided by our local bank. Foundation work is done by the university building program for the cost of concrete and forms. The high school construction tech program completes the framing. The electrical and plumbing are outsourced to contractors and the Sheetrock is finished by a social service program aimed at providing training to those being reintroduced into society.
The home is completed at a price far lower than average market values of similar homes. The design is five-star energy compliant, and the square footage totals 1,200 to ensure that the owners will have low energy bills.
Our nonprofit development corporation educates qualified buyers regarding budgets, credit, down-payment grants and the policies that allow them to gain long-term equity when purchasing an "affordable home" from our program (cannot sell the home for seven years without penalty). The local bank has provided a below- market fixed interest rate for our buyers, and the Feds have a program that backs the loan in case of default.
In this oversimplified scenario, our home was built far below its market value, and the loan on the property is below market rate, which translates into low mortgage payments. This system has been used successfully throughout the United States.
Affordable housing is a community responsibility that takes a long-term approach based on social equity, not profitability.