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HIGHLAND PARK ILLINOIS

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Title: HIGHLAND PARK ILLINOIS


1
HIGHLAND PARK ILLINOIS COMMUNITY LAND TRUST
2
City 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
Highland Park Illinois Community Land
Trust Page 2
3
Highland 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

Highland Park Illinois Community Land
Trust Page 3
4
The 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

Highland Park Illinois Community Land
Trust Page 4
5
How 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

Highland Park Illinois Community Land
Trust Page 5
6
Comparison 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

Highland Park Illinois Community Land
Trust Page 6
7
Sample HPICLT Homes
Richfield Avenue 180,000 (2005)
Temple Avenue Town homes Prices Varied (2004)
Highland Park Illinois Community Land
Trust Page 7
8
Additional HPICLT Homes
Burton Avenue 200,000 (2005)
Arbor Avenue 200,000 (2007)
Highland Park Illinois Community Land
Trust Page 8
9
HPICLT 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.

Highland Park Illinois Community Land
Trust Page 9
10
Inclusionary 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.

Highland Park Illinois Community Land
Trust Page 10
11
Anticipated 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

Highland Park Illinois Community Land
Trust Page 11
12
Cost 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

Highland Park Illinois Community Land
Trust Page 12
13
Who 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

Highland Park Illinois Community Land
Trust Page 13
14
The 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

Highland Park Illinois Community Land
Trust Page 14
15
Resale 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

Highland Park Illinois Community Land
Trust Page 15
16
Resale 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

Highland Park Illinois Community Land
Trust Page 16
17
Buying 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

Highland Park Illinois Community Land
Trust Page 17
18
Buying 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!

Highland Park Illinois Community Land
Trust Page 18
19
Questions?
  • Contact
  • Rob Anthony
  • Call 847-681-8746
  • Email ranthony_at_hpiclt.org

Highland Park Illinois Community Land
Trust Page 19
20
Special 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

Highland Park Illinois Community Land
Trust Page 20
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