Guest Editorial: A sensible piece to the workforce housing puzzle
Issues as important and complex as affordable housing demand innovative solutions. When those solutions engage government, nonprofits, businesspeople, and the families in need of housing, they can make lasting, positive change.
For 24 years, the New Hampshire Community Loan Fund and its public and private partners have pioneered a manufactured housing strategy that both preserves existing affordable (or workforce) housing and creates a bridge for working families to become homeowners. This strategy has proven so successful that we are spinning off a national organization to spread it across the United States.
The new organization is called ROC USA. ROC is short for resident-owned communities, one of the cornerstones of this housing strategy. The other is conventional single-family mortgage loans, which — you might be surprised to learn — is a new concept in the world of manufactured housing.
Lots of people think they know what manufactured housing is. Few do. Manufactured homes are the descendants of the 1950s travel-trailers, but they’re as different as today’s personal computers are to the Commodore 64. Today’s manufactured homes look and feel like homes built on-site, with porches, decks, Energy Star design and other amenities. They are affixed to a foundation, and they’re no more “mobile” than your town hall.
Although they are built to federal code, manufactured homes cost a fraction of what you’d pay for a comparable site-built home. That relatively low cost makes them one of the few options for low- and moderate-income families looking to buy their first homes.
Manufactured homes would be even more affordable if their financing had evolved as the buildings themselves did. But many homes are still financed through personal property loans. The interest on those loans can be twice as high as the 6 to 7 percent interest available for regular 30-year fixed-rate mortgages.
That began to change in 1984, when residents of a small park in Meredith, with the Loan Fund’s help, formed a cooperative and bought the land under their homes to create New Hampshire’s first resident-owned community. The immediate impact on the homeowners was greater financial security and control over physical improvements in their community.
Next, the Legislature stepped up, creating in 1988 a “60-day notice” law that gave homeowners notice and the opportunity to buy their park land when it was put up for sale.
Despite the fact that resident ownership secured the value of homes in these communities, traditional mortgage lenders still had to be shown that manufactured home-owners were stable borrowers.
In 2002, the Loan Fund worked with the state Community Development Finance Authority and six banks and created a home loan program for these buyers. Then the New Hampshire Housing Finance Authority began offering the first traditional fixed-rate single-family mortgage loans for first-time buyers in resident-owned communities.
Now we’re announcing a pilot program through which New Hampshire banks will offer conventional mortgage products to homebuyers in resident-owned communities.
Using these tools, the 5,000 people who now live in 88 resident-owned communities in New Hampshire have created housing stability, security and affordability for themselves and their families. And as lower-interest loans become available, more families can move from apartment to house, and more apartments will be available to rent.
Manufactured housing won’t by itself solve the affordable housing puzzle. But the Loan Fund/ROC USA model is a made-in-New Hampshire innovation that addresses the needs of all stakeholders: homeowners who want security; community owners who want a fair market value for their property; lenders who want value backing their mortgages; and a state that needs housing for its workers and elders.
Juliana Eades of Canterbury is founding president of the New Hampshire Community Loan Fund, which celebrates its 25th anniversary in November.