Up and Coming Weekly is a weekly publication in Fayetteville, NC and Fort Bragg, NC area offering local news, views, arts, entertainment and community event and business information.
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10 UCW MARCH 16 - 22, 2022 WWW.UPANDCOMINGWEEKLY.COM NEWS BEN SESSOMS, Carolina Public Press. COMMENTS? editor@upand- comingweekly.com. 910-484-6200. Down payment assistance for first-time homebuyers could be coming to Fayetteville city employ- ees soon. e City Council voted unani- mously last Monday, March 7, to have officials look into expanding its existing Good Neighbor Homebuyer Loan Program to include all eligible city employees. When the program first started in 2019, the $20,000 down payment assistance was only offered to police officers. e council also asked officials to increase that assistance amount to $30,000 to account for rising home prices. As of January, the latest avail- able data, the typical sales price for an existing single-family home in Fayetteville was $189,450, according to Longleaf Pine Realtors. at's an increase of over 11% from January 2021. Some ZIP codes in Fayetteville, such as 28314, 28306 and 28304, saw increases approaching 20%. ZIP codes 28305 and 28312 — which both saw an increase of around 30% — have median sale prices for exist- ing single-family homes at $243,000 and $304,504, respectively. "ere's been a serious appre- ciation of housing costs," Mayor Mitch Colvin said at last week' City Council meeting, advocating for the assistance increase. "Houses are competitive … instead of it being one offer or two offers, it's 10 offers. In order to really put them in the game, they have to put an increased down payment with the way prices have gone up." e program is funded through $400,000 from the city's general fund and from a $50,000 donation from First Horizon Bank. Fayetteville's economic and com- munity development director, Chris Cauley, said in an interview before the meeting that the program incen- tivizes positive community aspects in two key ways. "It's about that community-ori- ented policing that is so important to achieve," Cauley said. "And then it is also about relief — turning the tide from rental to homeowner- ship. at's one of the challenges with struggling neighborhoods. Someone's grandmother passes away, and the grandchildren are in another state, and so they just rent the house out until they can't rent the house anymore. at's how a lot of neighborhoods decline over time. "It's really in the city's interest and the community's overall to help pro- mote positive property ownership and homeownership from a gen- erational wealth standpoint, from a community safety standpoint and just from preservation of property tax values in those neighborhoods, keeping those neighborhoods intact." If the City Council approves a pre- sented plan to expand the program in the coming weeks, eligible city employees can apply for the assis- tance as soon as April, Cauley said. Who is eligible? If the program is expanded, city employees can apply for assistance if they meet certain criteria. Employees must have worked for the city for at least a year and received a "meets expectations" in their most recent evaluation. ey must also be a first-time homebuyer, which the city consid- ers as anyone who is purchasing the property, will live in the house as a primary residence and has had no ownership, sole or joint, in a resi- dential property in the three years prior to the date of purchase. ere are also income limitations. Employees and their families must have an annual household income at or below 140% of the area median income. In Fayetteville, that's $58,000 for a single person, and it's $65,700, $73,400 and $81,100, respectively, for household sizes of two, three and four people. Eligible city employees could pur- chase a home through the program only in certain neighborhoods. As it currently exists, the program is limited to homes in the Central Campbellton neighborhood and the Murchinson Road Corridor. e City Council also voted to have officials look into expanding that to four other neighborhoods — Massey HIll Community, Bonnie Doone, 71st District Community and Deep Creek. "ey all revolve around low- income census tract areas, areas that in some programs we call hard to develop," Cauley said. "If we're really looking to try to create home- ownership and tip the scale in our redevelopment areas, from renters to homeowners, then this is a really great program to do it." How the program works e down payment assistance will come in the form of a five-year depreciating loan. at means the amount owed, in the case that the city employee decides to sell, will decrease by 20% every year over a five-year period. At the end of the five years, the loan, which is given at zero percent, will be considered paid in full. Since this is considered to be a forgivable loan by the Internal Rev- enue Service, employees will also have to pay taxes on the assistance since it would be considered part of their annual compensation. at taxable income will be spread out of the five-year period of the loan. Homebuyer education class Another part of the program's ex- pansion is the addition of a home- buyer education class. Since the program started in late 2019, Cauley said about a half dozen police officers have inquired about the program, but none have pur- chased a home through it. Cauley said that the primary reason based on feedback was that officers didn't feel they were ready to buy a home. A homebuyer education class, Cauley said, could address that issue. "Folks just are not ready to be first-time homeowners and have been renters essentially their whole life," he said. "eir parents could have been renters their whole life, and buying a house is a serious thing. And it's also complicated. We wanted to put together a first-time homebuyer education class as a component of this." Cauley said the city would find a certified housing counselor who would teach the potential homeowners how to navigate the homebuying process from finding a lender and real estate agent to find- ing a home in their price range. e class would also teach them how to take on the new responsibili- ties that come with owning a home. Council member Antonio Jones, who is also a real estate agent, sup- ports this addition to the program. "ere's a lot that goes into buying a home, going from renting to buy- ing," Jones said. "e classes would definitely be beneficial because it prepares them for things that they may not have originally thought about or had to deal with on the rental side." Why not others in the city? During last Monday's meeting, council member Shakeyla Ingram inquired about adding other oc- cupations outside the city payroll to the program, specifically teachers and firefighters. Cauley said in response that sig- nificant changes would need to be made to expand the program in that fashion. "e legalities of that are very different than us funding our own employees," Cauley said. "is es- sentially becomes the base of their compensation." He also said hurdles exist to fund- ing assistance for people who are not low income. "We're very limited in what we can do outside of that moderate income for housing," Cauley said. "at's not to say that we couldn't, but that would need to really be a separate council direction for us to go work on something like that." Fayetteville may offer down payment help to its employees by BEN SESSOMS The Transit Center is housing meetings of the Fayetteville City Council while its regular offices are being remodeled. (Photo courtesy of Melissa Sue Gerrits / Carolina Public Press)