Cleveland Housing Network`s Lease-Purchase Program

Cleveland
Housing
Network
Mission:
To develop affordable housing with a special
emphasis on generating pathways out of poverty &
providing homeownership opportunities.
www.chnnet.com
Affordable Housing Development
4,488 housing units developed
(2,606 LIHTC single-family, 1,350 for-sale, 532 multifamily)
Training & Education
11,000 individuals served
Safety Net & Support Services
100,000+ services completed
Energy Conservation
99,000 services completed
Total Capital Investments: $533M
Opportunity Homes
Cleveland Green Homes
CHN’s Targeted Neighborhood
Stabilization Efforts
PARTNERS
Cleveland Housing Network, Inc.
Neighborhood Progress, Inc. (OppHo)
6 Community Development Corps.
before
Target Areas:
6 Cleveland Neighborhoods
Aligns with a city-wide market
recovery plan
Cleveland Housing Network, Inc.
http://opphomes.com
3-Year Goals
•  300 rehabs
(For-Sale & LIHTC Lease Purchase)
•  300 demolitions
•  300 foreclosures averted
before
•  Neighborhood Beautification
& Urban Gardens
•  Community Organizing
Cleveland Housing Network, Inc. http://opphomes.com
CHN Organizational Structure
as focused around the Single Family
Lease Purchase & For-Sale Programs
Rob Curry - Executive Director
Overarching Strategy/Policy & YR 16 Process/Closing
Kate Monter - Durban - Assistant Director - Resident Services
Community Training Center, Fund Raising
Pat Kenney - COO - For-Sale/Family Readiness/Sales Center, Single
Family Construction
Mary Smigelski, CPA - Director of Finance - Finance Department
Mark Whipkey - Director of Asset Mgmt - Real Estate Cluster
Real Estate Development – Tax Credit S.F. L/P, For-Sale S. F. Model
and Multifamily Real Estate Development /Construction
Property Management/Neighborhood CDC’s
Vanessa Norris, Director of Property Mgmt – Single/Multifamily
Liz Hernandez - Director of Property Services
Maintenance, Water Conservation, Energy Conservation
Cleveland Housing Network, Inc. http://opphomes.com
Opportunity Homes
For Sale Financing Model
Buyer AMI
Eligibility
Source
Incentive
<120%
NSP
working capital
& write down
<80%
Ohio
State write-down
<80%
FHLB
write down
<120%
City
CDBG write-down
Cleveland Housing Network, Inc. http://opphomes.com
Opportunity Homes
Sample Home Sales
For-Sale/Short-Term L/P Model
Total Redevelopment
$162,000
State write-down
($30,000)
City write-down, NSP
or CDBH/AHP
($42,000)
Sales Price
$90,000*
*city-deferred 2nd mortgage to buyer ($5,000-20,000)
Cleveland Housing Network, Inc. http://opphomes.com
CHN Existing Portfolio of
Single-Family Tax Credit L/P Homes
1569 units within the 15 year Tax Credit Compliance
Period (10/31/2010)
192 units in Year 16+ - Currently for Sale (10/31/2010)
Sales for First 10 Months - 2010 – 103 properties.
Sales to Existing Residents
Sales to New Residents
Sales Price to Qualified Residents - $26K
with up to 10 residency credit)
Sales to Neighborhood Non-profits/Local Landlords
Homes Graduating from 15 year Compliance Period
2011 - 157 homes
2012 - 28 homes
2013 - 177 homes (approx)
Cleveland Housing Network, Inc. http://opphomes.com
Opportunity Homes
Cleveland Green Homes
Cleveland Housing
Network’s Role
before
•  Owner, Co-Owner
•  Developer/GC
•  Property Management
• Training/Counseling
•  Sales & Marketing
•  Mortgage Loan Prep
Cleveland Housing Network, Inc. http://opphomes.com
Key Factors to Success
TARGETING
•  Choose homes in the right
neighborhood(s)
•  Target the right blocks
or streets
before
•  Choose homes worth saving
Cleveland Housing Network, Inc. http://opphomes.com
Key Factors to Success
MARKETING EXPOSURE
•  For sale/lease signs
•  Quality Websites
before
•  Call Centers
•  MLS listings
•  Quality Intake Systems
•  Open Houses
•  Customer Referrals
Cleveland Housing Network, Inc. http://opphomes.com
Key Factors to Success
SALES & LENDING MODEL
before
•  Affordable Sales Prices
•  Affordable Monthly Payments
•  Equivalency Principle for L/P
•  IDA Program for L/P
•  Quality Training/ Prep Team
•  Quality Lending Team
•  Alternative Lending Solutions – L/P
Cleveland Housing Network, Inc. http://opphomes.com
Lessons Learned
•  Target Right Markets with Right Product
•  Beat the Competition – Best Product/Service
•  Focus & Attention to Detail
•  Cast WIDE Net in Marketing/Leasing Efforts
•  Buyers Rule! Renter’s Demand Great Service!
•  Create Viable Exit Strategies
•  Short-term lease purchase for the For-Sale model
•  Alternative Disposition Strategies for TC Model atypical cases
•  Create/Maintain Reserves
•  Remember: Things ALWAYS take longer
than you think!
Cleveland Housing Network, Inc. http://opphomes.com
Opportunity Homes/Cleveland Green Homes
Where We are Now
459 Homes Impacted in 2 Years
•  171 rehabs complete or in process
(built to Green Communities© standards)
•  72% of for-sale homes sold
(or are under contract)
•  100% occupancy in LIHTC homes
•  232 blighted homes demolished
•  56 foreclosures averted
Cleveland Housing Network, Inc. http://opphomes.com