West Sacramento, Calif. — The promise of nearly two-dozen new, affordable self-help homes in Corning moved closer to reality recently thanks to a $320,000 Rural Community Assistance Corporation (RCAC) loan to local nonprofit organization, Self-Help Home Improvement Project (SHHIP).
The loan will allow SHHIP to purchase 21 lots on the eastside of the city for a planned cul-de-sac subdivision to be known as McDonald Court. The new project is located near Corning Commons, a previous SHHIP project. That 13-home self-help subdivision is one of three self-help home ventures SHHIP has already completed.
Other projects included an eight-home self-help project completed on lots scattered throughout the city and the 16-lot Casa Nueva subdivision. In addition, the organization is in the process of finishing 16 self-help homes on Donnovan Avenue in Corning. SHIPP expects to complete that project this summer. RCAC loans also provided financing for SHHIP’s scattered lots and Casa Nueva self-help homes. RCAC has been involved in Mutual Self-Help Housing projects for more than two decades.
Through Mutual Self-Help projects, low- and very-low income families and individuals attain the American dream of homeownership. In a Mutual Self-Help Housing Program, a group of eight to twelve families and individuals work together under the guidance of a construction supervisor hired by a nonprofit housing developer such as SHHIP. In lieu of a down payment, those in the program provide labor as “sweat equity.” Homes in any given program are built simultaneously, with future owners providing at least 65 percent of all labor. No family moves into their new home until all in the program are completed.
Mutual Self-Help homeowners have mortgages that are generally far less than those of standard new or resale homes and the program — which has seen nearly 25,000 homes built since 1971 — boasts a delinquency of a mere 3 to 4 percent.
Providing affordable housing continues to be a major concern for communities around the nation, but particularly in California where even small towns have seen home prices spiral upward at an unprecedented rate, leaving most moderate- and low-income families priced out of the home buying market.
Under the self-help model, a typical family of four would pay a minimum of 22 to 26 percent of their monthly income on their mortgage. In the case of McDonald Court, that translates to between $338 and $699 monthly. The cost is a far cry from Tehama County’s average monthly mortgage payment, which five years ago the US Census listed as $873.
Beyond affordable housing SHHIP’s stated mission is to also provide weatherization and utility assistance to low-income individuals in Shasta, Tehama and Trinity Counties.
Headquartered in West Sacramento, California, and serving 13 western states, RCAC is a nonprofit agency that provides technical assistance and training to rural communities seeking to develop a wide range of local services including, among other things, community facilities, affordable housing and water treatment facilities. The organization operates a loan fund with $50 million in lending capital that provides low-interest loans and grants to further these communities’ goals. RCAC has technical assistance providers in five locations throughout California.