Of the 27 homes that will be built in the Basalt Vista community, 14 are reserved for employees in the Roaring Fork School District. Eligible families will be selected by a lottery: one for the teacher pool of houses and one for the local workforce. Once selected, winners have to sign a reservation agreement with a $1,000 nonrefundable reservation fee.
Scott Gilbert of Habitat for Humanity noted that some winners struggled to come up with that $1,000.
“The people who are in the workforce came up with $1,000 no problem. The teachers, they just looked at us like, ‘You think we have $1,000?’” he said. “We ended up having to lower the commitment amount to sign the letter to $500 over two payments and they couldn’t even come up with $500 at that time. It was over at least a month where they could actually get to $500 in savings.”
To help make the homes more affordable, Habitat also gave homeowners the opportunity to help build the homes. Each adult in a household can contribute 250 hours on the build to earn a $25,000 credit on their down payment.
Gilbert also pointed out that homeowners who can get up to 20% of the purchase price of a home for a down payment can avoid paying private mortgage insurance.
Homes in the community are priced at different levels depending on homeowners’ income. Those who make up to 80% AMI are eligible for units ranging from $270,000 for a two-bedroom home to $345,000 for a four-bedroom. At 100% AMI, prices increase to between $295,000 and $370,000. Above that level, homeowners must pay between $345,000 and $420,000 before sweat equity.
All nine families accepted for the first round of homes opted to contribute sweat equity, Gilbert said.
[Related: Are you building ‘affordable’ or ‘attainable’ housing?]
Danielle Andrus was previously the managing editor for Colorado Builder, and is currently Editor for the Journal of Financial Planning.