Generations of low-income homebuyers will benefit from $2.5 million grant from state

BAINBRIDGE ISLAND, WA (January 22, 2024)—Housing Resources Bainbridge (HRB) was awarded a competitive $2.5 million grant from the Washington State Department of Commerce Housing Trust Fund to further subsidize its affordable homes at Wintergreen Townhomes. HRB is acquiring 31 homes in the mixed-income 73-unit development by Central Highland Homes now under construction near the Virginia Mason Bainbridge Island Medical Center off High School Road. HRB will sell to households earning 80% area median income or below.

“With the exorbitant cost of land and construction, it is flat-out impossible to build a home that is affordable to someone in our target income bracket,” said HRB Executive Director Phedra Elliott. “Our job as a nonprofit affordable housing provider is to leverage government funding to make it affordable. Our job as a community land trust is to keep it that way—forever.”

The first phase Wintergreen townhomes have a base price of $369,000 which places them slightly below market. HRB had already secured $15,000 per home from the Department of Housing and Urban Development (HUD) through its Self-Help Homeownership Opportunity Program (SHOP), bringing the price down to $354,000. In exchange, buyers perform 60 hours of sweat equity in the final stages of home building.

With the $2.5 million from the Housing Trust Fund, HRB anticipates lowering homes, on average, by an additional $80,000, so that the final cost to buyers is $274,000. To qualify, homeowners must be first-time buyers. This category is broader than the name suggests and includes people, for example, who have not owned a home during the previous three years or only owned one with a former spouse.

“This lower price point will allow our buyers more flexibility in their life—when their housing costs are lower then all the other financial decisions in life are a little easier, especially when groceries, childcare, education, and everything else is so expensive right now,” said HRB Homeownership Program Director Jackie Brasefield.

Together, the Housing Trust Fund and SHOP subsidies amount to $95,000. Because this assistance does not go directly to homebuyers to help them purchase a $369,000 home and is instead used to lower the price, generations of homebuyers to come will also benefit, maximizing the impact of these government funds.

In 2023, over 350 individuals called HRB to inquire about Wintergreen. “I have worked closely with buyers only to have them just miss the mark on qualification,” said Brasefield. “It is incredibly painful for the client and HRB when this happens—we want so much to deliver on their dream of homeownership. This grant and the lower price will make these homes a possibility for more buyers. I’m proud of what HRB was able to do for our clients and community.”

How community land trusts create permanent affordability

The 31 homes will be added to the HRB community land trust. With this model, HRB sells the home only while retaining ownership of the land underneath. It then leases that land to the homeowner for a 99-year term. Regulations in the ground lease—not market forces—dictate the sale price, ensuring that these homes remain affordable to future buyers while still allowing the seller to build equity. HRB homeowners earn a maximum return of 1.5% compounded annually.

“I continue to marvel at the efficacy of the community land trust model,” said Elliott. “Bainbridge Island has seen once-affordable homes sell for a million-plus at the first resale. By regulating sale prices and setting income requirements, HRB keeps its homes permanently affordable. And yet we also see our sellers build equity. These homes are truly a community resource.”

About Housing Resources Bainbridge

Housing Resources Bainbridge (HRB) is Bainbridge Island’s only nonprofit affordable housing provider and advocate. Since 1989, HRB has developed and stewarded permanently affordable homes to foster the social and economic health of our community.

Contact: Tamar Kupiec
tamar@housingresourcesbi.org
206.842.1909, ext. 11