MIDDLEBURY, VT - With many Vermonters feeling stuck because of the increasing costs of homes and the dire lack of availability, officials announced a new program to build more moderately priced homes across the state. The Missing Middle-Income Homeownership Development Program will provide subsidies and incentives for home builders to construct or rehabilitate modest homes affordable to Vermont homebuyers at 120% of the area median household income or lower.
Finance
Rising interest rates and prices decrease home affordability
Increasing mortgage interest rates and home prices have rapidly made it much more difficult for Vermonters to purchase their first homes. About half as many renters can afford to purchase their first home in 2022 compared to 2021, based on VHFA’s recent analysis of sales price and interest rate trends.
National mortgage interest rates rose substantially from 2021 to 2022. The 30-year mortgage interest rate increased from 2.74% in January 2021 to 5.52% in June 2022. Meanwhile, Vermont’s home prices were also rising. The median primary home sold for $259,900 in January through June 2021, increasing to $295,000 in 2022.
U.S. Treasury allows expanded use of stimulus funding for affordable housing
The U.S. Treasury Department recently announced new guidelines that will significantly increase Vermont’s ability to use pandemic recovery funding to directly support the development of affordable housing and reduce costs for Vermonters.
VHFA releases VHIF Annual Report
VHFA has released its first annual report for the Vermont Housing Investment Fund (VHIF). VHFA established the fund in 2020 in recognition of a growing need for more flexible financing opportunities for affordable housing development. VHIF investments are intended to fill gaps in project budgets, allowing worthwhile housing projects to move forward despite complex and changing development conditions.
Confidence in VHFA bonds increases ahead of bond sale
Strong financial performance contributed to a rating upgrade from Aa2 to Aa1 for Vermont Housing Finance Agency (VHFA)'s multiple purpose social bonds from Moody's Investor Service last week. Aa1 is the second highest possible rating from Moody’s. The rating applies to all outstanding long-term debt under the multiple purpose program and should help lower the cost of affordable housing financing through VHFA. Vermonter investors can purchase VHFA bonds during a sale scheduled for Tuesday of this week.
VHFA awards federal and state tax credits for 338 affordable apartments
The Vermont Housing Finance Agency (VHFA) Board of Commissioners announced last week the award of state and federal housing tax credits and loans to support the development, rehabilitation or preservation of 338 permanently affordable apartments in eleven communities across the state.
“Our state is currently facing many challenges in development but also many new opportunities to fund affordable housing,” remarked VHFA Executive Director Maura Collins. “The Vermont development community and housing funders have joined together to make these projects possible and get more Vermonters into safe, decent and affordable homes.”
Renovations celebrated at Whitney Hill in Williston
VHFA joined housing partners in Williston last week to celebrate the completion of major renovations at Whitney Hill Homestead. The project, developed by Cathedral Square, preserves 44 apartments for older Vermonters. The event was also attended by former VHFA Executive Director Sarah Carpenter, who was CEO of Cathedral Square when Whitney Hill was first developed using VHFA-awarded tax credits in 1992. The renovation project received state and federal tax credits and loan awarded by VHFA.
VHFA receives $4 million Capital Magnet Fund award to support 300 affordable homes
Vermont Housing Finance Agency (VHFA) joined Representative Peter Welch in South Burlington yesterday to announce a $4 million award from the federal government that will support the development of over 300 affordable apartments across Vermont over a three-year period.
AHP funding application opens June 6
The Federal Home Loan Bank of Boston (FHLBB)'s Affordable Housing Program (AHP) will begin to accept applications on June 6, 2022. The program will award a minimum of $10.6 million in subsidy funding through member institutions to organizations promoting homeownership and rental housing opportunities for low income households. This funding will support critical housing resources during a time of extreme housing shortage, affordability crisis and rising development costs.
Vermont Bond Bank announces Capital Plan Contest and Forum
Vermont Bond Bank has announced its first annual Capital Plan Contest as well as the Vermont Capital Planning Forum. In sponsoring the contest, the Bond Bank seeks to recognize best practices in communities of all sizes while allowing all Vermonters to benefit from exemplary models of capital planning throughout the state.