Awaiting the November vote on the Community Housing Fund, which could provide a source of funding for affordable housing, City Council began Tuesday afternoon to explore methods and sources of funding that have been used by many other municipalities.
Gwen O’Shea of the Community Development Corporation of Long Island (CDCLI), a regional non-profit organization that has been addressing affordable housing issues for over 50 years, briefly explained two concepts – Community Land Trust and Restrictive Developments .
The Community Land Trust concept creates low-cost housing because owners who buy a structure never own the land it sits on. Ownership of the land would either belong to the City or to a developer building the housing.
A negative aspect is the time it takes to set up a community land trust when “time is going to be a factor”, Ms O’Shea said.
Conversely, a restrictive development can be created by the landowner, but covenants must be applied to both the landowner and the purchaser of the structure. Neither, for example, could enhance the property with what would be considered “luxury” additions, such as a swimming pool or tennis court that could take the property out of the affordable category. This is to ensure that there are clauses in place that do not violate fair housing legislation, but limit what can be done by the landowner or home buyer to improve the property .
To maintain the property as perpetually affordable, it must be free of any covenants that might alter its intended use.
Ms. O’Shea also recommended modular housing over traditional construction because it costs less. She noted that the modules over the years are well designed and attractive. Modular housing is also being developed using green concepts, making it an investment in environmental sustainability, Ms Hanley said.
As for financing, there are sources that can be tapped for construction loans that would be repaid as buyers pay off their mortgages. There are also sources of money to help homebuyers meet their financial obligations.
Additionally, groups like CDCLI work with potential buyers to qualify them to buy or help them resolve any credit issues that may be making it difficult for them to qualify. A “rent to own” situation can help an individual or family get started as renters, but as they qualify for a mortgage, give them credit for the rents they have paid for the purchase price.
Ms Hanley pointed out that if voters approved the use of the Community Housing Fund transfer tax paid by people buying property on the island, it would be a positive step towards bailing out additional money until until the fund grows enough to become sustainable.