Paying it forward-The Basics of Denver Affordable Housing
Most real estate professionals don't understand the intricacies of selling and buying homes that are part of Denver's Inclusionary Housing Ordinance or what is more commonly called Work Force, Income Qualified or Affordable Housing, let alone the average consumer.
In a nut shell these homes are being marketed and sold below market value to buyers whose income falls below certain thresholds and is based on the number of people in the household. These homes are then deed restricted so that the savings they received on the home is passed on to the next buyer who also has a moderate income. That is why I think the term Pay it Forward is the best way to sell the Denver Affordable Housing program.
The myths that affordable housing is located in undesirable parts of the city or that a homeowner can't accrue any equity is simply not true. In the city and county of Denver, CO, income qualified homes are sprinkled throughout the metro area. Some of the hottest new urbanism neighborhoods such as Stapletonand Lowry are selling homes that developers can't keep up with. These affordable communities are mostly filled with first time home buyers and have to be owner occupied so there is a real strong sense of pride of ownership that runs through these newly constructed homes offering a great housing environment for all who live there.
Most commonly in Denver the income level is 80% of the Area Median Income(AMI) which starts at $42,550 and goes up from there. Buyers with these income levels would normally struggle to get qualified for a suitable home in the heart of Denver. Unless they are homes needing a lot of work or in areas that don't provide what they are looking for, i.e. safety, great schools, community feel, new construction etc.
When a buyer purchases a home they normally will contemplate the investment side and the livability side, making it a 2 fold decision on what home they will purchase. The Denver affordable housing deed restriction or affordability covenant, on the average will restrict a homeowner to approximately 3% appreciation per year compounded. In today's market that hasn't been much of a restriction being that most homes haven't appreciated that much. And when home values do begin to rise you will see a greater discrepancy between prices of market rate home and income qualified homes making the demand larger for the lower price, more attainable home.
I started selling the affordable housing in Stapleton 5 years ago when the program was in it's infancy. There was a lot of skepticism in the public eye and the real estate community. As an advocate of the program I am so pleased that the buyers confidence in the program has grown by leaps and bounds, unfortunately however I can't say the same for a lot of Realtors. It will be impossible for the program to reach it's full potential without Realtors being on board. If have seen that once agents take the time to learn the basics of the program it is far less intimidating and they realize the opportunities it creates. Then once they set showings and see these properties and they see how nice they are (and more importantly, their buyers love them). These agents are then fans and sometimes even pull out some of those old client files that they thought they couldn't ever find a suitable home and gives them new hope.
As long as the IHO in Denver is in effect, almost 10% of all new construction homes and many more of the refurbished homes are going to be part of the program. That is a pretty good piece of real estate pie to not be servicing. So Realtors, be ahead of the curve and don't be afraid to show and contract on these homes.
Feel free to go to my website at knophometeam.com and click on the Yes You Can Affordable Connection Team and learn some of the basics of the program and view some of the available affordable listings that I currently have. I will also pay referral fees for listings and buyers in the affordable program if you don't want to deal with the program. I also charge a small consultant fee if you just need a little help navigating your way through it. I am a big believer in the program and want it to succeed and I think the next step for that to happen is to have Realtor skeptics to become fans as well.
If you are a buyer interested in finding out if you qualify or want to see homes also go to my website Stapletonhometeam.com or call the Yes You Can Affordable Connection Team line at 303-332-8754 or email me at firstname.lastname@example.org.
The website is also a great tool for sellers who want to advertise their Denver affordable housing for sale. So feel free to contact me to advertise yours to buyers who are specifically looking for homes like yours. Developers, Builders, other Realtor listings and individual owners, it is tough for buyers to find you homes on MLS and other online searches. Let me post you listing and get it seen by the target audience you are aiming at.