Interfaith Housing, families plan to build homes with 'sweat equity'
Oct 10, 2014
At one time, Michelle Dixon had despaired of her growing family ever being able to afford to buy a house and move out of the 720-square-foot home they now rent. Saving for a down payment was the biggest hurdle, she said.
Then Dixon, 28, and her husband, Stephen, a 31-year-old corrections officer, learned about and enrolled in Interfaith Housing Services’ CASH (Creating Assets, Savings and Hope) Program.
While they were in class, learning about how to budget and identify savings, Interfaith’s Julia Westfahl came to talk to the class about a new program, the Mutual Self-Help Housing Program, in which families can contribute 20 to 30 hours a week helping to build their own home and the homes of their neighbors and essentially earn their down payment through “sweat equity.”
“At first, I wasn’t too interested,” she said. “I thought it would be too much work and take too much time. I just wanted to buy a house and do it the easy way. But my husband was really interested. I could see the look on his face. He loves woodworking, and he used to help his grandpa build homes in northern Michigan. He convinced me, and we signed up.”
And on Oct. 20, the Dixons and three other families will break ground on the building site for three of the homes near Avenue C and Poplar Street in South Hutchinson. The fourth house will be built at the same time in Partridge.
“I felt we’d never be able to afford a brand new home,” said Michelle, who is pregnant with the couple’s third child, due next month. “I thought we’d have to get a rundown fixer-upper. The fact that we are going to have a brand new home is still kind of unbelievable.”
Dwayne Mitts, who will be building the house in Partridge for his wife, Brandy, and five children, feels the same way.
“There is no way we would be able to get what we are getting without being involved in this program,” said Mitts, 36, who details and paints large agricultural equipment for a living in Wichita. “This is a good program. It’s giving people less fortunate (a chance). With my education and the number of kids I have, there’s no way we could do it without this program. We’d been looking for a house the last three or four years. There’s just no way.”
Westfahl, Interfaith’s director of housing, said the “mutual self-help program” started in January, when Interfaith received a grant from the U.S. Department of Agriculture that pays a part of Westfahl’s salary as program director as well as the salaries of a construction supervisor and another person who recruited families, certified their eligibility and helped them apply for a mortgage through the USDA.
The “mutual self-help program” is available in cities with populations less than 35,000 and to families that meet low-income guidelines. A family of four, for example, cannot have total income exceeding $44,000 a year.
Westfahl said the families will help build each other’s houses, and no family will get the keys to their house until all the houses are finished.
Mark Borecky, a home builder who lives in South Hutchinson, will be the construction supervisor, overseeing his own employees, professional subcontractors and the families as they work on the houses.
The families will do anything and everything from moving dirt to hanging siding, laying flooring, painting, installing cabinets and helping licensed plumbing, electrical and heating and air-conditioning subcontractors. The licensed subcontractors – Decker & Mattison for heating and air conditioning, Elite Plumbing and Kraft Electric – also will instruct the families on basic maintenance of the plumbing, electrical and mechanical systems.
All the houses will have about 1,250 square feet and have three bedrooms and two bathrooms on the main floor. One house will be slab construction, but the other three will have an unfinished basement, large enough for two more bedrooms, another family room and rough-ins for a third bathroom.
Westfahl said the houses are expected to appraise for about $150,000, and the families will be able to take possession with a USDA rural development loan of about $120,000, given their sweat equity. The families may also qualify for a subsidy to help them make their monthly mortgage payments.
Partridge Community Church donated four lots in that community for the self-help program, and Westfahl said they are still looking for families to build on three of those lots.
All the families will go through Interfaith’s CASH Program (Creating Assets, Savings and Hope) and take financial literacy classes to make sure they know how to budget income and expenses and are “set up for success,” Westfahl said.
“The CASH program is really exciting,” Dixon said. “It has taught us a lot about budgeting and setting goals and priorities and saving. I’m using a lot that I learned.”
The CASH program also offers most of its participants a 2-to-1 match on every dollar they save toward their goal, such as a down payment or improvements to a house. Mitts, for example, plans to save $2,000, which with the $4,000 match will give him $6,000 to immediately finish part of the basement of his new home, adding two more bedrooms and another bathroom for his large family, he said.
The first four homes in the self-help program are only the tip of the iceberg, however.
The city of South Hutchinson has about 20 acres that it will subdivide into 62 building lots and donate to Interfaith Housing for an expansion of the mutual self-help program in which moderate-income families also will be eligible. For a family of four, the upper income limit will be $96,000 a year.
The houses in Southern Hills, as the proposed development south of Avenue D and west of Lionette Fields will be called, will be identical to the four in-fill houses being built in the first self-help program, Westfahl said.
Interfaith and the city also have applied for a grant from the Kansas Housing Resources Council, which they hope to use to pay for construction of streets, water lines and sanitary sewers in Southern Hills so that the new home owners won’t be saddled with special assessments, Westfahl said. If they don’t get the grant, Westfahl said they have some other ideas for financing the infrastructure.
Dixon said that depending on how the winter goes, she hopes that her family can move into their new home in late spring. While her husband is excited about helping to build their home, she said she’s most excited about getting to decorate it and having a basement, garage and more room for their children.
The couple will be visiting a decorator to select flooring and paint colors on Monday.