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Low to Moderate Income Rental Housing

Development of Low/Mod Income Rental Housing


The North Suburban Consortium (NSC) utilizes US Department of Housing and Urban Development (HUD) HOME Funds to assist developers in the creation of affordable housing. These funds are available for developers for rental and homeownership projects in any of the eight NSC member communities (Malden, Medford, Arlington, Melrose, Chelsea, Everett, Revere and Winthrop).
 

The federal HOME Investment Partnership Program (HOME) is the primary resource that NSC uses to address one of the most pressing housing needs identified in the Consolidated Plan --- the need for affordable housing for low-income households.  The HOME Program was created under Title II of the National Affordable Housing Act of 1990 to:

  • Expand the supply of decent and affordable housing, particularly rental housing, for very low- and low-income Americans;
  • Strengthen the abilities of state and local governments to design and implement strategies for achieving an adequate supply of decent, affordable housing; and
  • Extend and strengthen partnership among all levels of government and the private sector, including for-profit and non-profit organizations, in the production and operation of affordable housing.

The regulations that govern the HOME Program are found at 24 CFR Part 92.
 

NSC receives an annual allocation of HOME funds through HUD. Rather than having a specific Request for Proposal process at a given time during the year, projects are considered on an ongoing basis.  We suggest an interested potential developer/applicant contact the NSC to make an appointment to discuss a project.
 

Eligible Applicants
Any private for-profit or not-for-profit entity that can demonstrate the capacity to develop and operate a qualifying project is eligible to apply for HOME project funding.
 

Eligible Areas
All eight NSC communities.

Income Eligibility
HOME Program funds may only be used to assist households with incomes at or below 80% of area median income. Rental projects must primarily serve households with incomes at or below 60% of area median income. Assisted rental units must remain affordable for a period of between 5 and 20 years, depending on the initial amount of subsidy provided for the project.
 

Rental Housing Development
HOME-assisted rental housing must comply with certain rent limitations. HOME rent limits are published each year by HUD. The program also establishes maximum per unit subsidy limits and maximum purchase-price limits.
 

For rental housing and rental assistance, at least 90% of benefiting families must have incomes that are no more than 60% of the HUD-adjusted median family income for the area. In rental projects with five or more assisted units, at least 20% of the units must be occupied by families with incomes that do not exceed 50% of the HUD-adjusted median. 

Affordability Requirements
HOME-assisted rental units must adhere to the rent and income limits described below for the following terms*:

  • Rental Housing Activity
  • Minimum Period of Affordability
  • Under $15,000
  • 5 years
  • $15,000 to $40,000
  • 10 years
  • Over $40,000 or rehabilitation involving refinancing
  • 15 years
  • New construction or acquisition of newly constructed housing
  • 20 years

*These are minimum requirements required by HUD and NSC may have a longer affordability requirement.

Homeownership Opportunity
HOME funds can be used for the acquisition and/or rehabilitation of existing structures for sale to income-eligible first time home buyers, including distressed or failed properties, or for the new construction of homeownership projects. Projects seeking HOME funds must include a minimum of 3 HOME-assisted ownership units, the sites for which must be secured with a signed Purchase & Sale Agreement at the time of application.
 

All first time home buyers purchasing HOME-assisted units must have a household income of not more than 80% of the area median income.
 

Each HOME-assisted unit must have an appraised value that does not exceed 95% of the area's median price, as determined by the Single Family Mortgage Limits under Section 203(b).

The length of the Affordable Housing Restriction (a/k/a deed rider) for the home buyer is 30 years. In the event that the home buyer desires to sell the property prior to the end of 30 years, certain resale/recapture requirements will apply. All HOME loans will be non-recourse and secured by a mortgage on the property.

Application
Please complete the Developer Application with assistance from the NSC community representative where the project will be located. The application must be submitted to the member community staff person who will determine whether to submit it along with the community's formal sponsorship to the NSC Board. The NSC only considers applications sponsored by the host community.

If the proposal is consistent with the NSC’s priorities in the Consolidated Plan, and the applicant demonstrates sufficient experience and resources to pursue the project, the NSC board will make a decision regarding commitment of funds, and request additional information needed to undertake a complete financial analysis.
 

Project Selection Guidelines
To be considered for HOME funding a project must be:

  • Located within one of the eight communities;
  • Eligible under HOME Program regulations; and
  • Consistent with NSC’s Consolidated Plan and HOME Program priorities.

Projects meeting the threshold requirements are further evaluated based upon the extent to which the project:

  • Is ready to proceed;
  • Sponsor has the experience and ability to carry out the proposed project;
  • Cost-effectively increases the supply of housing that is affordable to low-income persons, particularly in areas that are accessible to expanding job opportunities;
  • Exceeds the HOME Program's minimum requirements to serve very low- and low-income residents;
  • Provides matching resources;
  • Has other reliable funding sources committed to the total cost of the project;
  • Provides supportive services if proposed project targets persons with disabilities;
  • Provides facilities and services that permit elderly or handicapped residents who become frail and need assistance to continue to reside in the project;
  • Preserves the affordability of housing that may be converted, demolished or abandoned;
  • Remedies the effects of discrimination and improves housing opportunities for disadvantaged minorities; and
  • Stimulates investment and participation by the private sector.

HOME funds are allocated in amounts appropriate to the scope and needs of the proposed project. HOME funds are provided in the form of low interest loans. The NSC reserves the right to:

  • Adjust the amount of funds allocated to projects and to negotiate modifications to the proposed work plan and budget prior to executing an agreement; and
  • Fund those projects which reflect the highest and best use of HOME funds.

For additional information, please call the HOME Director at 781-324-5720 x 5729.

NSC Member Communities


Funding Approved for Affordable Housing Development at 54 Eastern Avenue, Malden

Documents