For first-time buyers, purchasing an affordable home in Wisconsin has become challenging. It’s even harder for low-income residents.
Over the past couple of years, interest rates have soared, and the number of houses for sale hasn’t kept up with the number of new homebuyers.
The Metcalfe Park Homeownership Initiative is looking to break that barrier.
The initiative is a lease-to-purchase program that will allow 30 tenants living in the Metcalfe Park neighborhood the opportunity to become homeowners.
Wisconsin-based developers Gorman & Company built the 30 single-family homes 15 years ago on tax-foreclosed lots. The homes, which are now worth about $130,000 each, are being sold to tenants between $40,000 and $80,000.
The homes are available at those prices because the developers built the homes as part of a Low-Income Housing Tax Credit (LIHTC) project in 2007 — the provision allows tenants to buy their homes 15 years after construction. The rent that current and previous renters have paid Gorman over the last 15 years is counted as equity.
To help eligible tenants learn about the homeownership opportunity, the developers partnered with several groups including the Greater Milwaukee Urban League, Acts Housing and the Wisconsin Housing and Economic Development Authority (WHEDA).
By March, five of the 30 homes at Metcalfe Park will have been sold, says Eve Hall, the president and CEO of the Milwaukee Urban League.
“We'd love to go faster, but what we've also learned in this process is that we need to make sure, first of all, these homes are purchase-ready for our residents to ensure they are positioned for longevity and success in maintaining homes,” Hall says.
Dee Kemp, vice president of programming for Acts Housing, says the nonprofit homeowner advocacy group specifically works one-on-one with tenants to improve their finances and eventually get them to a stage where they can get pre-approved for a mortgage.
“We are a one-stop shop for homeownership, Kemp says. “We really have everything a family would need to complete the entire process, whether that’s a real estate agent, non-traditional financing options, rehabilitation and renovation options.
“We strongly believe it’s not just about you getting the house, it’s about you keeping the house. It’s about putting you in a sustainable and affordable situation. That's how you build generational wealth and that’s how we close the wealth gap between the white and Black communities here in Milwaukee.”
Charlicia (Char) Brown is one of the first residents in the Metcalfe Park neighborhood to buy her home through the program. She says she had lived in her home for over 12 years and paid $1,100 per month in rent before purchasing her home last year.
Since then, her monthly mortgage payment is now about $600 per month until she pays off the house in 15 years. She says the support of Acts Housing and the Milwaukee Urban League has empowered her.
As a single mom raising three boys, Brown says she found it difficult to pay all her bills sometimes, but with the help of a homebuyer coach through Acts Housing, she says she learned to manage her finances successfully.
“To me [homeownership] means security,” Brown says. “Having equity available to me provides me with opportunities. I feel safe — I feel that if anything happens, I always have options. I'm just blessed with Gorman working with the Urban League and Acts Housing — to provide us help is more of a blessing than I can really comprehend. So in a lot of ways, it still hasn't really sunk in, you know, me being a homeowner. It’s beyond my wildest dreams. To me, it's just like, the possibilities are endless.”
Kemp says Gorman & Company plans to sell more than 200 homes over the next 10 years under the lease-to-purchase homeownership model.
“I feel like too often, especially in America, being independent, pulling yourself up by your bootstraps — that's what we're known for,” she says. “But the reality is that if the good Lord wanted you to know everything, he would, but he didn't because he wants us to rely on each other… and lift each other up.
“So I think this partnership is just an excellent example of that, because we're all in our lanes, doing the things that we do really well to have a great outcome like Char had.”
