St Tammany Parish is one of the fastest growing Parishes in the state. Population growth has increased the number of service workers while land prices in St. Tammany continue to rise. Many essential service workers, medical personnel, teachers, and first responders can’t afford homeownership in St. Tammany. As the first community land trust serving St. Tammany Parish, NHI will help workers to live where they work. NHI buys the land; the homebuyer buys the house and leases the land from NHI for a small monthly lease payment. The result is lower monthly housing costs.
Where does NHI get the money to buy the land?
Through a generous grant from the State of Louisiana and St. Tammany Parish Government we help moderate-income homebuyers live and work in St. Tammany Parish. We have a grant commitment over the next three years in CDBG grant dollars earmarked for the purchase of land to help working families buy homes in St. Tammany. This grant will allow us to help about ten moderate-income families a year become homeowners. Homebuyers will purchase existing houses, new houses or houses under construction. Most homes will be in the $140,000 to $180,000 range including land. The typical NHI land investment will be $34,000.
Why should I partner with NHI to purchase a home?
There are a number of benefits to purchasing a house through a community land trust:
1. Prices you can afford - Land trust homes are more affordable than homes purchased on the open real estate market. Homes purchased with NHI typically cost $30,000 to $40,000 less than market rate value. This means truly affordable monthly housing payments for you. Even after paying the monthly lease the typical buyer will save about $140 per month.
2. Safe loans with reasonable down payments - Our partner homeownership specialists and lenders provide access to safe financing with low fixed rates, no private mortgage insurance and the lowest possible down payments.
3. Homeownership - Consistent housing payments allow you to build equity and receive federal tax deductions for mortgage interest and property taxes.
4. Community - NHI is a community based membership organization. Your lease means you are automatically a member. You can choose to participate in the NHI community through voting, volunteering, and becoming a CLT board member.
5. Support - NHI homebuyers have the support of NHI staff as long as they own their homes. NHI provides a wide array of support to homeowner members – from informational newsletters to hands-on home improvement workshops.
How do I determine my household income?
To compute your household income, add together the gross income (before taxes) of all members of the household who are over 15 years old. Household income includes every form of income, salaries and wages, retirement income, near cash government transfers like food stamps and investment gains.
Can you tell me more about how the NHI Ground Lease works?
Because NHI owns the land and you own the home, we both sign a ground lease that defines our roles and responsibilities. The ground lease secures your use of the land for 99-years and is renewable and inheritable. This means that you could own your home for as long as you live, bequeath the home and the right to use the land to your children and they could do the same – on and on across generations. The nominal lease fee, usually $45 per month, gives you full use of the land, membership in NHI and support services. The lease includes a resale formula that protects your return of paid in equity on your home and provides for sharing any appreciation based on a formula that gives you credit for how long you have lived in the house and preserves the affordability of the house to the next buyer.
What happens if I want to sell my house?
If you decide to sell your home, NHI has first option to purchase it. If NHI does not exercise the option to purchase, you are obligated to sell the home to an income-qualified household and the resale price is limited by the resale formula in the ground lease.
A resale sample follows:
Homes purchased through NHI remain affordable for every new buyer. This shared equity method provides good stewardship of public funds for housing, serving the present community and future generations.
Who pays the property taxes?
Through a special arrangement with St. Tammany Parish Tax Assessor’s office, property taxes will be assessed separately on your home and the land you lease from NHI. You, the homeowner, will pay the taxes associated with the building and improvements. As a 501(c) 3 non-profit organization, NHI is exempt from property taxes. You are also eligible for Homestead exemption. Your homebuyer training will provide instructions for filing for this important tax reducing exemption. Your property taxes and mortgage interest payments also provide federal tax-deductions.
What kind of support does a community land trust provide for its homeowners?
At NHI we make a long-term commitment to our homeowners. Types of support offered by NHI to homeowners include education, resources and community events. Community land trusts have helped homeowners with foreclosure prevention and re-financing options. NHI homebuyers are part of a larger community – they can choose to participate in the NHI community through voting, volunteering or becoming an NHI board member.