Title: HIGHLAND PARK ILLINOIS
1HIGHLAND PARK ILLINOIS COMMUNITY LAND TRUST
2City of Highland Park Inclusionary Housing
Program
- Ordinance requires developers of covered projects
(5 units) to provide 20 of the total units at
an affordable price - At least 50 of the
- affordable units must
- be affordable to a
- household earning
- 80 of AMI
- The first inclusionary
- units were completed
- in late 2007 at Laurel
- Court
- Homebuyer applications are administered by HPICLT
Laurel Park
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Trust Page 2
3Highland Park Illinois Community Land Trust
- HPICLT is a private, nonprofit 501(c)(3)
organization created in 2003 to preserve and
develop high quality affordable housing in
Highland Park - Its work helps bridge the gap between the
increasingly high cost of homes and the incomes
of many people who live and work in our community
school teachers, City employees, health care
workers, retail staff, and others who serve the
community on a daily basis
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Trust Page 3
4The Relationship Between the City of Highland
Park HPICLT
- The City of Highland Park was instrumental in the
creation of HPICLT, but HPICLT is an independent,
501(C)(3) nonprofit entity - HPICLT bylaws allow the Mayor of Highland Park to
appoint 3 members to the HPICLT Board of
Directors - The City of Highland Park provides a significant
portion of HPICLTs annual operating budget
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Trust Page 4
5How the Community Land Trust Works
- HPICLT purchases properties from what is
available on the market and also constructs new
homes (for both rental and home ownership) - The organization sells each home at an affordable
price to an income-qualified buyer - HPICLT retains ownership of the land
- The land is leased to the home buyer for a
nominal fee (25 per month) - If a home buyer wishes to sell their home, resale
restrictions require that the homes be sold to
HPICLT or an income-qualified buyer at a formula
price that keeps the home affordable for the next
buyer
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Trust Page 5
6Comparison of HPICLT Homeownership Vs Traditional
Home Ownership
- Same
- The home owner has a mortgage with a bank
- The home owner accumulates equity
- The home can be inherited
- The home owner pays property taxes
- The home owner can make alterations and
improvements - The home owner receives federal mortgage tax
deduction and a property tax credit on state
income tax
- Different
- The purchase price is typically 20-65 below the
market rate - With a CLT property, HPICLT owns the land under
the home - the home owner leases the land from
HPICLT for a nominal fee - Resale restrictions require the home to be sold
to HPICLT or an income qualified buyer - The resale price is based on a formula designed
to ensure the continued affordability of the home - HPICLT IHP home owners pay lower property taxes
due to the resale restrictions
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Trust Page 6
7Sample HPICLT Homes
Richfield Avenue 180,000 (2005)
Temple Avenue Town homes Prices Varied (2004)
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Trust Page 7
8Additional HPICLT Homes
Burton Avenue 200,000 (2005)
Arbor Avenue 200,000 (2007)
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Trust Page 8
9HPICLT Homes Available
- 560 Vine, 135,000
- 2 br, 2 bath home features brand new countertops,
kitchen cabinets, flooring, refrigerator,
dishwasher, microwave and in-unit washer/dryer as
well as new painting and carpeting throughout.
Master bedroom has a large walk-in closet. Close
to schools, shops, and transportation. Assigned
car port included. Professionally managed,
monthly assessment 252.
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Trust Page 9
10Inclusionary Housing Program Units Available
- 849 Laurel Avenue - 164,478
- 3 br, 2 bath new construction in the heart of
Highland Park. Home includes in-unit washer
dryer and 2 underground heated parking spaces.
Situated close to library, trains and shopping.
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Trust Page 10
11Anticipated Homes
Phase 1 Two 4-bedroom town homes Phase 2
Five 2- and 3-bedroom condos
- Inclusionary Housing Program - 14 homes in four
separate locations are in various stages of
development (2 single-family homes, 5 town homes
7 condominiums) - HPICLT - 5 scattered site homes, 10 town homes
4 apartments are expected to be available over
the next 18 months
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Trust Page 11
12Cost of Typical HPICLT IHP Homes
- Cost of HPICLT single family homes typically
range between 170,000-225,000 - Cost of the IHP homes will vary with each
development and the size of the home - 1-bedroom range will be 113,103-195,330
- 2-bedroom range will be 130,643-223,445
- 3-bedroom range will be 148,183-251,191
- 4-bedroom range will be 162,245-273,388
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Trust Page 12
13Who Can Qualify for a Home?
- Maximum income limits will vary based on funding
source requirements HPICLT limit is 115 of AMI
and the IHP limit is 120 of AMI - The combined assets of a household after
purchasing a home may not exceed 150 of AMI for
the household size (for a family of 2, assets
can not exceed 90,450, for a family of 4,
assets can not exceed 113,100). The home
acquired will be excluded from the assets. - Home buyers must qualify for a mortgage from a
participating lender - CLT home buyers must contribute a minimum of 1
down payment - All homes must be owner-occupied
- To ensure that units are not underutilized,
household size will be matched to unit size - First time home buyers must complete a U.S.
Department of Housing Urban Development
approved pre-purchase counseling program
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Trust Page 13
14The Resale Process
- If a home owner decides to sell their home, the
home can be sold to the HPICLT or Housing
Commission (depending on the program) or to
another low-to-moderate income buyer - The price is determined by a resale formula that
provides owners a return on their investment,
while keeping the home affordable for future
buyers - The formula price limits the amount of
appreciation that can be realized by the owner
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Trust Page 14
15Resale Formula Example
- Initial Purchase
- Initial appraised value 300,000
- Minus purchase price reduction
120,000 - Equals Home Buyers Purchase Price 180,000
- Resale 10 years later
- Current appraised value 510,000
- Minus Initial appraised value 300,000
- Equals market value appreciation 210,000
- Multiplied by Home Owners Investment Ratio
60 -
- (210,000 X .60) Equals 126,000
- This is the share of appreciation attributable
- to the owners investment
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Trust Page 15
16Resale Formula Example
- The share of appreciation attributable to the
owners - investment 126,000
- Multiplied by shared appreciation factor 15
- (126,000 X .15) Equals 18,900
- This is the owners share of Market Value
- Appreciation (MVA)
- Owners Purchase Price 180,000
- Plus Owners share of MVA 18,900
- Plus Improvements credit, if any
4,800 - Equals Formula Price 203,700
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Trust Page 16
17Buying a HPICLT or IHP Home
- 1) Attend an orientation workshop
- 2) Apply for a mortgage pre-approval from a
participating lender - 3) Submit a complete application and pre-approval
letter to HPICLT - 4) HPICLT will review the application for
conditional eligibility based on the established
resident selection criteria for each program - 5) HPICLT will notify applicants of conditional
eligibility (usually within 3 business days) - 6) Applicants will be placed on a waiting list
based on the date that a complete application
package was submitted to HPICLT and according to
the resident selection criteria for each program - 7) When a home becomes available, HPICLT will
notify the next conditionally eligible applicant
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18Buying a HPICLT or IHP Home
- 8) Applicants will have the opportunity to view
the existing home or review the plans and
specifications for a new unit under construction - 9) If the applicant wishes to purchase the home,
they will be allowed to sign a purchase agreement - 10) Within five (5) days of signing a purchase
agreement, applicants must submit evidence that
the sales contract and other legal documents have
been reviewed by independent legal counsel, as
well as a stipulation indicating an understanding
of the resale restrictions - 11) Prior to closing on a home, first time home
buyers must submit a copy of their housing
counseling certificate from a HUD-approved
pre-purchase counseling program - 12) Close on the home!
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Trust Page 18
19Questions?
- Contact
- Rob Anthony
- Call 847-681-8746
- Email ranthony_at_hpiclt.org
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Trust Page 19
20Special Thanks to the Following for Their
Financial Support
- City Council of Highland Park
- Highland Park Housing Commission
- Lake County
- Chicago Community Trust
- National City Bank
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Trust Page 20