Home ownership for those who work in Napa
The Problem:
As in many attractive communities, Napa's workforce must compete for housing with those who want to retire in Napa or own a second home here. In fact, the number of residents in the upper valley has declined as more homes are now owned as second homes. Another problem is that typical affordable home ownership programs restrict the future sales price of the home and the hope for an equity gain similar to the rest of the market. It also removes any incentive to improve the property. Building more housing in Napa is a challenge and can not be restricted to those who work in Napa. The likely buyers are retirees and second home owners who can afford to pay more. This results in the need for more low to moderate income workers to provide the additional services required and thus greater demand for low to moderate income housing. Thus, simply building more housing leads to more congestion, more commuters, and high prices. A more creative solution is required. |
Our approach:
We won the Challenge Award for creative solutions by the California State Association of Counties in 2012. The following video was made by CSAC at that time and does a good job of summarizing our program. It is accurate except that we now have over 100 homeowners and we require homes to be bought within 20 miles of work (previously 15).
After researching our options, and working with local stakeholders including our realtors and bankers, we arrived at the Napa Work-Proximity Housing program. We assist low to moderate income workers in Napa with the purchase of the house of their choice in Napa using our affordable housing trust fund. We provide qualified buyers 10% of the purchase price of a home and require that when they sell the property, we get 10% of the future sales price. No interest is accrued. Essentially, we take a 10% silent equity stake. If the homeowner builds equity, we build equity. A qualified buyer is a low to moderate income worker in Napa who intends to buy a home within 20 miles of where they work. We pre-qualify the buyers so there is no hold-up during the escrow process. The program reduces the miles traveled to work and helps resist the displacement of workers from Napa who may currently be renting in Napa. The program is very cost effective. A typical loan is $30,000 to $40,000. The loans are paid back and used again so the fund is permanently active. We are 5 years old and have over 95 families in home ownership, 25 this calendar year. 15 loans have been repaid as the owners have seen significant appreciation and we able to refinance and pay off the loan. |
Work Proximity Housing Fund Statistics as of Oct 4, 2016
For more information on how to apply click
"Work Proximity Housing".
"Work Proximity Housing".
