DENVER — High housing prices are making homeownership a distant dream for more Coloradans. But on Monday, Denver City Council debated a $6,220,000 grant proposal that would go toward acquiring at least 62 homes over the next three years to be available for affordable homes.
The most recent Cato Institute 2022 Housing Affordability National Survey shows 55% of current homeowners said they would not be able to afford their home at current housing prices, and 69% said they worry their children or grandchildren won’t be able to afford a home.
Carmen Mayta was someone who thought she’d never be able to become a homeowner.
“I was feeling that hopeless. No, I won’t qualify for anything. I don’t have 10% or 20% to put down for a property. I don’t have savings,” she said.
That was before she applied to work with Elevation Community Land Trust, a local non-profit that uses the community land trust model to provide permanently affordable homeownership opportunities to hundreds of people across Colorado.
“We don’t make money on our deals, we are a non-profit. But what we really like is helping to build inter-generational wealth, which so many folks have been shut out of recently,” said Tiana Patterson, VP of Social Impact and Wealth Equity at ECLT.
ECLT builds housing or purchases houses, fixes them up, then sells them at a price affordable to lower-income families. The homeowner owns the home, but the land stays in trust.
A recent ECLT property in Aurora just closed for $299,000 while homes of a similar size for sale right now in the same neighborhood range between $325,000-$430,000.
Denver City Council considers $6 million grant for permanent affordable homeownership
“The trade-off is you do a shared appreciation. You don’t take all of the appreciation out of the home, but you do pass it on to someone else who can also access permanent affordability,” explained Patterson.
If a homeowner sells the home, the price needs to be what they paid for it, plus only a quarter of what it appreciated for over the years. That keeps the property affordable for the next person.
“It’s a model that maybe isn’t for everyone, but for those who’ve been waiting for a way to get their first home, or get into, you know, just out of a renting situation. This could be a really good option,” said Patterson.
ECLT puts private capital into the projects in addition to grant funding and subsidies from partners and local governments.
The majority of the $6 million ECLT grant would come from the American Rescue Plan Act and state and local fiscal recovery funds and $700,000 from Impact Investment Funds.
“I think we’ve proven to the city that we are a partner who gets things done, who provides this homeownership model, and we’ve been working with them since about 2018,” said Patterson of the upcoming decision.
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