Stapleton ( now Central Park ) Affordable housing program (Denver, Colorado Springs: sale, lease)

[don macauley]

My daughter applied and was accepted into the Denver affordable housing program . They are building new condos by the light rail in Stapleton which will be subsidized . Has anyone ever purchased through this program ? I know a few of the pros and cons of the program but I'm learning as i go . If anyone has first hand knowledge / experience of this program please share your thoughts . tks Don

[2bindenver]

It’s deed restricted for life. Her appreciation will be limited.

[Therblig]

Originally Posted by 2bindenver

It’s deed restricted for life. Her appreciation will be limited.

Meaning... what, exactly? That selling price is capped or that it can only be sold to qualified low-income buyers?

[2bindenver]

Both. It’s good for short term owning. For example, your daughter thinks her income will increase more in three to five years.

If appreciation is 10% a year a $300,000 property would be $400,000 in three years. But deed restricted appreciation would only allowed to sell at $340,000 to another approved buyer.

[Therblig]

Eh. Makes it kind of a marginal deal unless there is mortgage approval support as well.

It is so hard to make affordable/subsidized housing work in any active market.

[don macauley]

Originally Posted by 2bindenver

Both. It’s good for short term owning. For example, your daughter thinks her income will increase more in three to five years.

If appreciation is 10% a year a $300,000 property would be $400,000 in three years. But deed restricted appreciation would only allowed to sell at $340,000 to another approved buyer.

Well its 3% appreciation a yr. to another approved buyer. Any upgrades will not be included in the new sale price . Its 3% a yr appreciation on the purchase price.

[don macauley]

Pros .. much better than paying 1200 bucks a month rent , having to renew a lease every yr , wondering about an increase. This way she's locked in as far a monthly payments . Cons .. limited to 3% a yr appreciation , cant only sell to another approved seller. Living in Denver area is pricey , where can you find a brand new condo for 170 K 2br, 2 ba ?

[Therblig]

Originally Posted by don macauley

Living in Denver area is pricey , where can you find a brand new condo for 170 K 2br, 2 ba ?

...in a kinda crummy area right next to the light rail lines?

[Augie Daugie]

Actually, it is not deed-restricted for life. Each unit has a set control period that lasts 15-30 years, depending on the covenant. During the control period, the affordable unit must be sold at a restricted price to a qualified buyer. After the control period, it can be sold for market value. However, the city has the first right of refusal to purchase the home at market value within the first 30 days after the control expires. If the city doesn't buy it, then you can sell it for market value, but if it is sold within 10 years after the control period expires, half of the excess profits must be paid to the City's Housing Incentive Program Fund.

I've sold a few of the income-qualified units sold by Thrive. ImO, it makes sense as a way to control housing costs and provides buyers with an affordable way to live in the Central Park neighborhood. As you've mentioned, it is pretty much impossible to find a 2/2 condo anywhere in Denver for $170K, let alone a condo that is across the street from a grocery store and a commuter rail station. The deed restriction also prevents you from renting it out if she decides to move out, but she can rent out a room to a friend if she's looking to further subsidize her housing costs.

[abcdefg567]

Originally Posted by don macauley

Well its 3% appreciation a yr. to another approved buyer. Any upgrades will not be included in the new sale price . Its 3% a yr appreciation on the purchase price.

And they take 1/2 of the profit from the first sale up to 30 years. *Might want to check the documentation for this. Read everything carefully. I might be off on specifics, but it seemed like a bad deal.

We almost bought one of the townhomes, but backed out due to this, and moved to Colorado Springs where $300k bought (well, 3 years ago) a larger home in a nice neighborhood, that was actually cheaper than the Stapleton townhome would've been monthly.