Three new infill houses for modest-income individuals or families are now being built in Winnipeg’s West End by the Housing Opportunity Partnership (HOP).
When the houses are completed in three to four months, weather permitting, HOP, which was established by WinnipegREALTORS® in 1997, will have either built or refurbished and sold 90 homes in the West End.
Lori Thorsteinson, the chair of the HOP committee, said the three two-storey, fully-framed infill homes on Arlington, Langside and Maryland, will help the program eventually reach its goal of completing 100 homes in the West End for people with modest incomes.
The only impediment to achieving this goal is obtaining additional funding. Thorsteinson said HOP’s funding from government sources runs out in March next year.
“We have no guarantee that our funding will be extended, but we are still applying for more funding from the province, and expect to have our proposal ready soon,” she added.
Meanwhile, Thorsteinson said HOP has been so successful over the years in helping to revitalize housing in the West End, that the partnership has had to change its emphasis in recent years on infill housing rather than refurbishing existing housing.
“We’re having an impact in the area, but our acquisition costs have been going up,” she said. “We’ve ended up focusing on what is called a tear-down. We try to acquire boarded-up houses from the city.
“It’s a win-win for everybody, Thorsteinson added. “The city has a new home built on an otherwise vacant property, and in the process gets a new long-term taxpayer.
“It all has an impact with an increase in house prices in the neighbourhood, new homeownership, and we’re even seeing crime rates go down,” she commented.
The crime rate in the area actually decreased by 27 per cent between 2006 and 2010.
Peter Squire, who is the market analyst for WinnipegREALTORS® and a member of the HOP committee, said home values in the area have increased to between $149,900 and $199,900.
Since the program began purchasing and refurbishing houses, the average price of a residential-detached home in the area has risen by 544 per cent.
Even acquiring a tear-down house can cost HOP between $60,000 to $75,000 for what is essentially just a lot to be built upon.
It now costs HOP about $280,000 to acquire a tear-down property or a lot and then build an infill house. The province has been providing market-gap funding to keep the cost down to the home buyer. Houses are never sold at full market value by HOP.
In the first years of the program, Squire said HOP was able to purchase homes for as little as $10,000 to $20,000, which reflected the dilapidated state of housing in the neighbourhood.
“A lot of good has come out of the program. We’re providing a very good home that is built to R-2000 standards and has a warranty,” Thorsteinson explained.
Frank Zappa, who is the head of property acquisition for HOP, said many families wouldn’t be able to purchase a home without the help of the program.
Squire said HOP’s target base is families, single parents and new immigrants.
To qualify for a HOP home, an applicant must have an annual income under $64,606, be a first-time home buyer, and be able to qualify for a mortgage.
A five-per-cent down payment and $1,500 towards closing costs are also available to qualifying home buyers.
In addition, the home must be owner-occupied, not rented, and the buyer is required to live in the home for at least 10 years.
A forgivable second mortgage is placed against the property should owners sell within the first 10 years of owning a HOP home.
The program has become so popular that there is now a waiting list of 40 potential home buyers.
“It shows there is certainly a need for more housing in the neighbourhood,” said Thorsteinson.
“As we buy up and repair boarded-up houses, we see more private investors doing so as well,” said Zappa. “That’s the success — when private investment comes in.”
To date, over $12 million has been invested in the city’s West End by HOP.