December 18, 2018

VHDA Grant Helps Planning Efforts to Preserve Affordable Housing Along Alexandria’s Route 1 Corridor

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Alexandria is putting the final touches on a plan it hopes will safeguard its dwindling inventory of affordable housing.

Since 2000, 88 percent of Alexandria’s market-affordable units have been lost. These units, which have unregulated rents, often house low- to moderate-income families. With two rental properties on its Route 1 corridor – 215 units in all – in danger of joining that list in the next two years, the city wants to change its redevelopment and zoning guidelines to protect those properties and others. A Community Impact Grant from VHDA has helped fund that work in its early stages.

At the heart of the process was a series of community engagement activities designed to solicit feedback and gain consensus from a broad cross section of stakeholders. The most meaningful activity,by far, was a collaborative planning and policy session called a charrette. This week-long meeting was attended by several hundred people including neighbors, the residents and owners of the two Route 1 properties, city staff members, and community service organization representatives, some of whom brought special expertise to the group.

“Without VHDA’s grant money, there’s no way we could have pulled off such a comprehensive strategy and planning effort,” said Helen McIlvaine, Alexandria’s director of housing. “In addition to the charrette, VHDA’s funds helped pay for market and housing development studies, postcard mailings, door-to-door outreach and similar activities. It also covered language interpretation and translation services that helped us engage the diverse group of residents who are likely to be impacted.”

Federal subsidy contracts have helped the two Route 1 rental properties remain financially viable over the years. But those subsidies will expire in 2019 and 2020, increasing the likelihood that the property owners will choose to redevelop them. If that happens, the families who reside there – nearly all of whom make less than the area’s median income – could be priced out of their homes.

Alexandria’s charrette focused on both short- and long-term issues related to the properties, including a plan to relocate the tenants temporarily if redevelopment occurs. Traffic patterns, school capacity and housing density were also key topics. It’s estimated that three or more new market-rate rental units will need to be built in order to conserve one of the existing affordable units.

McIlvaine believes their work can jump-start tangible improvements to the city’s housing environment. “We want our planning and strategy work to create an envelope that can guide redevelopment along the Route 1 corridor, and potentially be a template for elsewhere in the city,” she said. “That will include, hopefully, zoning changes that help maintain our existing inventory of affordable housing, at close to their current level of affordability.”

Recommendations from the charrette were integral provisions in Alexandria’s long-term planning document, titled the Rt. 1 South Housing Affordability Strategy. It was unanimously approved by the planning commission on September 4, and by the city council on September 15, 2018.

The safe bet is that redevelopment economics, as well as other financial pressures, will continue to put affordable housing inventories in jeopardy. But in Alexandria, the belief is strong that proactive planning will drive policy and zoning changes that can balance those realities.

Building More Housing Options in Southwest Virginia

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As game plans go, “Build it, and they will come” was a home run for Kevin Costner in his 1989 movie which was set in the cornfields of Iowa. But here in the hills of Southwest Virginia, officials are learning to play by a different rulebook: “They’re coming, and it’s time to build.”

Since 2015, employment levels in Botetourt County have spiked 17 percent, a welcome trend that could continue. While this has put the county in an enviable position, it’s also caused complications. One of them stands out perhaps above the others: Botetourt’s diverse and growing population needs more housing.

Knowing that, in late 2016 the county commissioned a study to evaluate housing demand by type and price range. The results of that study were eventually presented at a day-long housing summit sponsored by VHDA and local partners such as the Roanoke Regional Home Builders Association.

A VHDA Community Impact Grant helped fund that study as well as other activities the county is undertaking to improve its housing environment.

“VHDA’s grant money has been an important catalyst,” said Gary Larrowe, Botetourt’s County Administrator. “It provided the means for us to tap the expertise of external consultants, and it will also help fund a toolkit designed to help us drive smart housing growth. Our conversations regarding housing have yielded amazing results.”

Botetourt’s goal for new housing is ambitious: to build 1,000 new units, equally split between apartments and townhomes. So far, progress has exceeded expectations – 500 homes in four new developments have been approved, which will create enough space for at least a thousand residents, if not more.

A large luxury apartment complex called The Reserve at Daleville is one of those developments. With 188 units spread over 17 acres, The Reserve required a change in zoning from agricultural and shopping centers to high-density residential (R-4), with a special exception permit for up to 15 multifamily units per acre. That change was approved by the county in November 2017. Botetourt supervisors passed a resolution in September that will allow VHDA to finance this development through its Mixed-use/Mixed-income loan program. Households with a broad range of incomes will be eligible to rent homes there.

Daleville Town Center, whose 99 units will be flanked by townhomes and additional single-family units now under construction, is another pending addition to the county.

Meanwhile, Botetourt’s housing task force continues its work. On its agenda are meetings with county stakeholders as well as with the planning commission and board of supervisors. Its policy toolkit, which will describe regulatory barriers to housing development and outline strategies to overcome impediments to housing production and affordability, is slated for completion by the end of 2018.

Botetourt County’s response to its housing shortage has yielded strong early results, thanks in part to VHDA grant funding and loan financing. Here in Southwest Virginia, the building has just begun.

Closing the Housing Affordability Gap in Northern Virginia

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In the shadow of the nation’s capital, Loudoun County has a growing, diverse and affluent population. For years, it’s been America’s richest county, achieving a median annual household income of $134,000 in 2016. Yet too many people who work there – including many number of law enforcement officers, fire and rescue squad members, teachers, nurses and other professionals – can’t afford to live there because of high housing costs.

Against that backdrop, Phyllis Randall, chair at-large of Loudoun’s Board of Supervisors, brought forward an item to the board to take a holistic look at the county’s housing challenges. VHDA was one of the organizations invited to participate.

Dale Wittie, VHDA’s Director of Rental Housing, covered a range of topics at the Board of Supervisors meeting. He explained how VHDA finances housing properties, both newly constructed and renovated, through loans that require owners to rent a portion of their units to households of limited means. He also described how the authority administers the federal Housing Credit program (formerly the Low-Income Housing Tax Credit program), which encourages the private development of affordable rental properties.

As a summary, he emphasized that VHDA’s financing options offer developers and localities not one approach, but many. “What works well in one situation may be ineffective in another,” he said. “Our funding sources and lending terms allow developers to do what they do best – that is, to structure economically viable deals that create self-supporting commercial real estate.”

According to Randall, VHDA’s presentation was helpful on several fronts. “We knew they had a wealth of information, and they didn’t disappoint,” she said. “Of particular value were the comments on zoning. They reinforced what we already knew – that zoning needs to be a malleable entity, and not a brick wall.”

Since then, Loudoun has convened a housing summit which included private, nonprofit and public sector entities to discuss actionable steps to increase its stock of affordable housing. It has explored ways to increase the assets in its Affordable Dwelling Unit Program, which helps low- and moderate-income households rent or buy housing. It also has designated parts of eastern Loudoun as revitalization areas. This designation assists developers and localities in their efforts to create and sustain housing for low- and moderate-income residents.

In addition, the county has inventoried its public lands and is studying whether some may be suitable as development sites. The county also is looking at new guidelines for housing loans, and has begun to streamline its zoning process.

Chair Randall believes Loudoun is building a better housing environment, but that the job is far from over. And it remains one of her highest priorities. “Loudoun is a remarkable place, and we want everyone who works here to be able to live here.”

Using Data to Answer Key Housing Questions In the New River Valley

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When it came to regional housing issues, the New River Valley Regional Commission had no shortage of questions: Do we have enough housing types and price points for people of all income levels? How do university student rental properties affect the availability of affordable rental housing overall? Do existing housing units match up well with buyer preferences? How can deteriorating housing stock be better preserved or rehabilitated?

Thanks to a grant from VHDA, the commission will soon have answers to these questions and others, and gain a better understanding of how to meet the region’s current and future housing challenges.

The New River Valley in Southwest Virginia encompasses Montgomery, Floyd, Giles and Pulaski Counties as well as the city of Radford. Its planning commission will use VHDA’s Community Impact Grant funds to develop and implement a multi-pronged study. Among its components will be focus groups, an online survey and public meetings, all designed to gain feedback from real estate agents, builders, developers, residents and other stakeholders. The study will also tap publicly available data from real estate and housing sources. While designed from a regional approach, the project is also expected to yield data that will helpful to individual localities in developing strategies, policies and action plans.

VHDA has been awarding Community Impact Grants since 2015. Money for the grants comes from VHDA’s REACH Virginia program. Each year, VHDA contributes a substantial portion of net revenues to fund this program, which is used to address housing needs throughout the state.

“We’re encouraged that we’ve definitely seen an uptick in the number of applications for Community Impact Grants,” said Director of Strategic Housing Chris Thompson, in VHDA’s Community Outreach division. “Our evaluation and approval process ensures that REACH Virginia dollars are put to the best possible use – by organizations that share our goal of making affordable housing accessible to all Virginians.”

Learn more about VHDA’s grant programs at

November 26, 2018

Coming Soon to a Homesite Near You

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They’re built in a controlled environment that promotes a high-quality finished product. Compared to their competition, they take a fraction of the time to complete. They’re designed to be safe and sturdy. But perhaps best of all, they’re highly affordable – usually much less expensive than their more traditional counterparts. 

They’re factory-manufactured homes – structures built in one location, then trucked to a homesite. And nationwide, countless families live in them comfortably and happily.

Fleetwood Homes is one of many companies in this line of business. In September, two dozen representatives from VHDA, the Virginia Department of Housing and Community Development, and the U.S. Department of Agriculture-Rural Development visited Fleetwood’s manufacturing facility in Rocky Mount, Virginia, to learn more about how such homes are produced, and what they have to offer.

“One of our roles at VHDA is to create public awareness about matters related to affordable housing,” said Chris Thompson, VHDA’s Director of Strategic Housing in the Community Outreach Division. “We wanted to see for ourselves what goes into making a factory-built home.”

What the group saw on their tour impressed them. “In terms of their durability, workmanship, energy efficiency and aesthetics, these homes were eye-opening,” said Thompson. “In almost every way, they seem to be upgraded from what they may have been in the past.”

At Fleetwood, craftsmen complete every phase of a home’s construction, including plumbing and electrical, within the confines of the factory, thus avoiding weather delays that often plague site-built homes. The company uses “green” building methods and energy-efficient materials to save their customers money and to protect the environment.

The public’s perception of factory-manufactured homes may not always reflect their reality. While they aren’t necessarily the best choice for everyone, some buyers find that their price, quality and convenience intersect at exactly the right place.

“Our tour reinforced what we already thought to be true – that factory-manufactured homes are a comfortable, affordable and viable option for some families, whether they’re renting or owning,” said Thompson. “It was a great visit, and well worth our time.”

The Bloom and Carpenter’s Shelter Groundbreaking

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2-1-1 Takes on a New Meaning in Northern Virginia

Two operations, one building and one mission: helping the less-affluent with their housing challenges.

That’s the case in Alexandria, where officials have broken ground for The Bloom, an apartment complex for low-income households, and for a replacement structure for Carpenter’s Shelter, now serving the homeless from a retrofitted DMV office. The two operations will share a single building. The Bloom’s 97 rental units – reserved for tenants who make less than 60 percent of the area’s median income – will sit atop the shelter. The energy-efficient building will have an underground parking garage, a 1,600-square-foot garden, a playground, a community room and outdoor terraces. Its proximity to schools, shopping and public transportation exemplifies “smart growth” development. Under this planning approach, urban growth is confined within compact areas to reduce sprawl and foster safe, walkable and sustainable neighborhoods.

VHDA and Alexandria Housing Development Corporation worked hand-in-hand to make this venture a reality. VHDA has committed $10.3 million to fund it, including $5 million from REACH Virginia. VHDA contributes a substantial portion of our net revenues to fund this program, which addresses housing needs throughout the Commonwealth.

VHDA’s financing or Housing Credits have helped launch other affordable rental properties in Alexandria in the past. Examples include Lacy Court Apartments, Arbelo Apartments, Longview Terrace Apartments and The Station at Potomac Yard, which total 183 units. A future endeavor, The Gateway, will have 74 units, a grocery store and office space, and it will also house a new bus rapid transit station.

Attending the groundbreaking of The Bloom and Carpenter’s Shelter were numerous state and local elected officials and other guests. Speakers included Governor Ralph Northam, Congressman Don Beyer, Alexandria Mayor Allison Silberberg, AHDC President Daniel Abramson, Shannon Steele from Carpenter’s Center, and VHDA’s Director of Rental Housing Dale Wittie.

November 21, 2018

Helping First-time Buyers Make More Competitive Offers

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After scrimping and saving for years, a young couple is finally ready to purchase their first home. Like many first-time buyers, they’re far from wealthy but their credit is good and they’ve been pre-qualified for a mortgage. Their excitement is contagious, and their Realtor is again reminded of why she chose to make this work her career. Together they look at several properties, and then they find it: the perfect first home. Small, but in a favorable location, with good curb appeal and an attractive floor plan.

There’s just one problem.

When they crunch the numbers, there’s not enough for a down payment, or the monthly payment falls just beyond reach. The couple eventually finds a less expensive house, but it doesn’t quite measure up to the one they really wanted.

Situations such as this were the basis for creation of the VHDA Plus Second Mortgage. It’s a new product designed to make homebuying more affordable for first-time buyers.

It’s a 30-year fixed-rate loan that covers the entire down payment, when coupled with a VHDA first mortgage. There’s no prepayment penalty, and the second mortgage has the same interest rate as the first mortgage. This is a distinct advantage over other second mortgage products, which often carry interest rates three or more percentage points higher than a first mortgage. Other products may also have shorter terms (15 or 20 years instead of 30), balloon payments, or both.

Borrowers with a credit score of 680 or higher can fold part of their closing costs into a VHDA Plus Second Mortgage, and every borrower receiving this loan qualifies for a VHDA Mortgage Credit Certificate. An MCC allows borrowers to deduct 20 percent of their annual mortgage interest as a dollar-for-dollar credit against their federal income tax liability. The remaining 80 percent can be taken as a traditional tax deduction. Even with the tax law changes taking effect in 2018, first-time buyers with an MCC can still benefit, whether they itemize or take the standard deduction.

The VHDA Plus Second Mortgage must be paired with one of three VHDA first mortgages: an FHA loan or one of two Fannie Mae conventional loans.

The big picture is clear. The VHDA Plus Second Mortgage can make homebuying more affordable for first-time buyers. With less cash needed up front, it frees up money they may need later for furniture, improvements and more. It lets them make more competitive offers, especially when they’re competing against buyers who can make a five percent down payment, and it may enable them to finance their closing costs instead of asking for assistance from the seller.

First-time homebuyers and real estate agents may contact any VHDA-approved lender for information about this or other VHDA products, such as down payment grants and free homebuyer education. VHDA maintains a database of approved lenders at