We thank our Executive Director’s Notes - October 18, 2007
members: It was great to see many of our members last week at the multiple events I attended – it was six
presentations/meetings in five days! Quite a week for housing issues. Special Thanks to the folks
from KB Homes for involving me in their Citizens Advisory Council meeting.
SunTrust I spent the past three days in Washington DC visiting with other state housing coalitions from
NC Housing Finance around the country, and staff and legislators from NC who represent us on the national level.
Agency First, a thank you to all the folks Denise Neunaber from the NC Coalition to End Homelessness
Federal Home Loan and I visited with in DC: Rep. David Price and staff persons Catherine Liao and Jordan Hinkle;
Bank of Atlanta Rep. Mel Watt and staff person Hilary West; Kate Fox from Rep. McIntyre’s office; Cybil
RBC Centura Gregory Roehrenbeck from Rep. Jones’ Office; Neil Mahoney from Rep. Hayes’ office; Sean
O’Brien from Rep. Shuler’s office; Matthew Dockham from Rep. Myrick’s office; Jen Mundy
Reznick Group from Rep. McHenry’s office; Chris Medley from Rep. Etheridge’s office; Chris Wall from Sen.
BB&T Burr’s office; and Robbie Boone and Ryan Miller from Sen. Dole’s office.
Bank of America
Carolina First Bank These were important meetings and we very much appreciate the interest of staff and
congress people in housing issues in NC. Our focus was on upcoming HUD, Section 8, and
Hope VI bills, while giving staff a picture of the housing and general economic/growth issues
Announcements/Jobs in NC. In the House, we focused on increasing funding for PHAs, the Senate version of
Section 8, since it uses the most recent data and has more Veterans and Family Unification
Member Spotlight voucher, and the House version of HOPE VI, since it requires 1:1 low income unit replacement
and has a better requirement of resident involvement in the process.
This Week’s Articles: We also talked about upcoming LIHTC legislation (no specifics yet, just emphasis on the
tremendous value of this program and how NCHFA has utilized it to respond to high priority
Fed chief: Housing to needs), the predatory lending and foreclosure abuse, and tenant protections from foreclosure
drag economy legislation that passed in NC this session, as well as the need to reform the bankruptcy laws
as advocated by the Center for Responsible Lending (to include primary residence).
weather housing slump Most disappointing was the news that several national organizations that should be supporting
the National Housing Trust Fund had been actively lobbying to raise the income targeting
HUD proposes to close a of the Trust Fund away from the highest priority needs. We know who they are and will call
mortgage loophole them out publicly, and encourage local affiliates and supporters to criticize them if it happens
in the Senate version. For now, we hope everyone can move forward and continue to work
for this investment in the areas of greatest need on housing issues.
Beazer to restate
financials after finding
Monthly Fair Housing Training Series
NC Housing Coalition invites you to attend a Rights and Responsibilities of Landlords and
Property Managers 101 Training in Candler on October 26, 2007, 9:00 am – 12:30 pm
Foreclosure filings in the small conference room at the Haynes Center at ABTCC Enka Campus in Candler (near
nearly double Asheville).
Sun Communities beats This training will focus on the rights and responsibilities of landlords and property managers
housing slump under Fair Housing laws, including Reasonable Accommodations, and NC Landlord-Tenant
Law. Registration costs are $20 for NC Housing Coalition members and $30 for non-
Coalition to help avoid members. Registration is required, and closes a week before each event. For more
foreclosures information and to register, please click here. A training is scheduled for Winterville on
November 2, with more to come in other parts of the state in 2008.
Down payment aid could
soon end National Housing News
Biggest news in quite a while is that the National Housing Trust Fund passed the US House of
Representatives last week! This legislation would create an estimated $2 billion fund distributed
to states targeted to low to moderate income housing production. It is the most significant piece of
housing production legislation in years, and represents the best way to both create and distribute
County board approves critically needed housing production resources to the country and NC.
Hope VI funding
Similar legislation is expected to be introduced in the Senate soon, and Denise and I will be working
County, nonprofit reach hard to ensure the support of Sen. Dole (whom we hope will be a co-sponsor) and Sen. Burr on this
affordable housing effort.
Click here for more of the latest in national housing news, courtesy of NLIHC and HAC.
For the latest news in housing and the Coalition, click here to visit our blog.
Habitat to welcome
visitors from Guatemala Thanks for being a member of the NC Housing Coalition,
Fair Housing Trainings
NC Housing Coalition invites you to attend a Rights and Responsibilities of Landlords
and Property Managers Training.
This training will focus on the rights and responsibilities of landlords and property managers
under Fair Housing laws, including Reasonable Accommodations, and NC Landlord-Tenant Law.
This training is designed for landlords and property managers of developments that serve
low to moderate income residents. Certificates of attendance are available.
Asheville: October 26, 2007, 9:00 am – 12:30 pm in the small conference room
(209) at the Haynes Center at ABTCC Enka Campus; 1459 Sand Hill Rd., Candler, NC
Winterville: November 2, 2007, 9:00 am – 12:30 pm in the Leslie Building
Auditorium (Room 143) at Pitt Community College; 1986 Pitt Tech Rd., Winterville, NC
Registration costs are $20 for NC Housing Coalition members and $30 for non-members.
Registration is required, and closes a week before each event.
For more information and to register, please click here.
NC Housing Search: Free Marketing Service for Owners / Managers
Property owners and managers can reach thousands of potential renters through
NCHousingSearch.org, a statewide marketing service for affordable rental housing.
NCHousingSearch.org is cosponsored by the N.C. Housing Finance Agency and powered
by Socialserve, a nonprofit that has worked in the Asheville, Charlotte and Greensboro areas
for several years.
This free service allows you to highlight the amenities and features of your property, provide
photos and list eligibility requirements. Landlords can also take advantage of several built-in
property management tools. The site is currently recruiting landlords to list properties. We
strongly encourage property owners and managers in our programs to list with
Through NCHousingSearch.org, renters can search your up-to-date property vacancies, get
maps and directions, see pictures and contact information. Individuals without Internet access
can request information to be mailed or faxed to them at by calling a toll-free number, 877-
428-8844. This bilingual call center is available to assist both landlords and tenants with listing
and locating properties.
For more information go to NCHousingSearch.org.
Habitat Wake is hosting fall Information Sessions for prospective homeowners at the
Habitat Wake offices.
During these sessions, Habitat will explain the application process, and provide/collect
Dates and times are as follows:
Saturday, October 27, 10 AM. – 11:30 AM
Saturday, November 17, 10 AM. – 11:30 AM
Saturday, December 15, 10 AM. – 11:30 AM
No RSVP required. No fee to attend or apply. Find details and directions at:
Habitat for Humanity of Wake County is both a home builder and mortgage company with 20+
years of experience helping families stop paying rent on places that are unsafe, overcrowded,
substandard or expensive. Habitat for Humanity is not a government agency; it is a non-profit
organization supported by charitable contributions.
Volunteers are need for Project Homeless Connect Raleigh on Thursday, October
25th in Moore Square (downtown Raleigh).
Project Homeless Connect is a one-day, one-stop service event to connect people experiencing
homelessness to resources they need to become self-sufficient. For more information and to
register as a volunteer please visit www.raleighhomelessconnect.org.
The 8th Annual CHAM Asset Management Professionals' Conference: Turn Up The
Trump Sonesta, Miami Beach, Florida
WHO should attend?
CDC and nonprofit executive directors, CFOs, asset and property managers
Public housing authorities, state housing finance authorities, agency reps
LISC, Enterprise, and NeighborWorks® America staff
Industry experts, lenders, funders
Anyone and everyone involved in the affordable housing industry!
To download the conference brochure and to register, click here (or go to the LISC
For further information or to discuss vendor possibilities, contact Diane Patrick at
email@example.com or 212.455.9378.
The Consortium for Housing and Asset Management (CHAM) Annual Asset Management
Professionals' Conference is the only professional development and networking event devoted
solely to building the capacity of affordable housing asset managers through sharing
ideas on asset and property management topics, searching out solutions to common problems,
previewing emerging issues and trends, and building relationships with colleagues in the field.
Raleigh City Council Public Hearing: Draft Analysis of Impediments to Fair Housing
The Raleigh City Council has scheduled a public hearing for Nov. 7 at 7 p.m. to receive public
comment on the draft analysis of impediments to fair housing choice. Citizens will have 30
days to provide comment on the study. To see a copy of the draft study, contact the City of
Raleigh Community Development Department, 857-4330, or visit the department at 310 W.
Martin St., suite 101.
Doors of Asheville art auction to benefit Mountain Housing Opportunities
November 8, 5:30-7pm
Doors of Asheville Preview
Location: Grove Arcade
November 29, 6:30pm
Doors of Asheville Auction
Location: The Orange Peel
Music by Brian McGee & The Hollow Speed
$55 per person/
$100 per couple
EITC Carolinas Capacity Building Small Grants Available
Any community organization that includes free tax preparation with the IRS VITA program or
Tax Counseling for the Elderly may apply. If the sponsoring organization is not a formal non-
profit 501 (c)(3), then it must partner with a non-profit to serve as fiscal agent. In addition,
participating organizations must be able to track and report expenditures and must be willing
to collect and share project data and results. If your organization is offering free tax
preparation for the first time, we strongly suggest that you contact us as soon as possible so
that we can link you up with available technical assistance resources.
For more information, please contact either of the following individuals at the contact
Lucy Gorham (919) 969-2682, firstname.lastname@example.org
Tiki Windley (919) 969-8583, email@example.com
Proposals are due Friday, November 9th. We would appreciate an e-mail submission of
your proposal on this date, as well as an original and one additional hard copy to be mailed
and postmarked by the same day. Mailing us a hard copy ensures that, if for some reason
your proposal was not accepted by our e-mail system, we would know that you are submitting
an application. Letters of support can either be e-mailed or included in your mailed copy.
Notification will be made via e-mail by 5 p.m. on Friday, November 16th. As soon as grants are
awarded, we will work to get contracts completed. We hope to have grant funds available to
you by mid-December.
Sustainability for Organizations: Now and in the Future
Program Leaders/Facilitators – Arnaud Maitland
Center for Skillful Means Workshop Component: November 27, 2007, 9 am – 5 pm
Long term sustainability is an on-going challenge for many enterprises today. Financial
pressures, changing markets, deadlines, internal conflicts, concerns about staff welfare and
performance can put mounting pressures on leaders that seem to drain the life out of work and
limit the potential of an organization’s success.
Skillful Means methods provide leaders with the structure, components and tools to face
challenges and create/maintain a healthy sustainable business – that is an organization that
has the ability to consistently create positive change and desirable outcomes that benefit
individual employees, owners, clients/customers, shareholders/investors and a wider
community. Participate in a program to refresh your perspective and learn proven methods
that will enable you to create an internal structure that will sustain your organization over
Long term sustainability factors include:
Establishing consistent ongoing positive change and successful outcomes.
Creating and implementing opportunities for on going evaluation and appreciation of
Planning and implementing the connection between vision, strategies, goals, activities,
outcomes and time.
Identifying external factors critical to long term reliable success and cultivating these
external forces to drive successful results.
Applying methods to overcome obstacles that limit your organization’s performance.
Program Outcome: Use Skillful Means methods to identify components for sustainability within
your organization and design the structure and conditions to implement them successfully.
Program Participants and Cost:
Program is open to owners, leaders and key staff of non-profit organizations and businesses.
Enrollment is limited to 8 participants. Program cost is $600. This includes substantial one-
on-one interaction and coaching.
Please visit www.skillfulmeansprograms.com or contact Teri Beckman at (919) 286-9530 for
more information and to register for the program.
2007 Housing Tax Credit Awards Announced
The 2007 housing tax credit awards are now posted on the NC Housing Finance Agency
Through your efforts, the Agency was able to fund 44 projects in 26 counties totaling 2,169
units. Thanks to everyone that participated in this year's cycle.
SHDP 400 and The Key Program Operating Assistance and Preservation Loan
Program applications are posted.
The new SHDP 400 and Key Program Operating Assistance and Preservation Loan Program
applications have been posted on the NC Housing Finance Agency web site at:
2008 Qualified Allocation Plan Available
The draft 2008 Qualified Allocation Plan is now available on NC Housing Finance Agency's
website along with the draft Appendix B (design) and major revisions memo.
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Pembroke Housing Authority Housing Services Coordinator
Minimum Education, Training, Experience and Skills: Graduation from high school with
some business courses and two years of progressively responsible related administrative or
clerical work experience. Experience with public housing populations preferred. Basic
knowledge of Microsoft Word and Excel. Possession of valid North Carolina drivers’ license.
Duties and Responsibilities: Accepts applications, interviews applicants, and verifies
applicant information; determines eligibility and establishes priorities among applicants based
on established guidelines; communicates eligibility determination to applicants. Compiles,
prepares and maintains a variety of information, data, reports and files in a variety of
categories on applicants, residents, and housing units such as tenant accounts receivable
report, annual occupancy report transfer list, vacancy report and various federal forms;
prepares and types reports; maintains security deposit book and tabulates monthly to reconcile
with analytical sheet; composes and types correspondence with residents and others.
Calculates changes in rent based on changes in income, family, and other deductions;
communicates agency rules, changes, and regulations to residents; conducts annual
reexamination process re-verifying and calculating rent. Receives resident complaints; handles
routing manners; refers more difficult issues to Director of Operations; refers residents to
public assistance agencies. Conducts new resident orientation. Compiles data and performs
50058 submissions to PIC monthly. Attends magistrate court proceedings on a monthly basis
to process resident’s evictions due to violations of the dwelling lease. May provide office
support for other positions within the Central Office.
Application Procedures: Interested persons who meet the qualifications above should
complete an application, available at www.pembrokeha.com and submit it to:
Lemark Harris, Executive Director
Pembroke Housing Authority
Post Office Box 910
Pembroke, NC 28372
Applications are also available at 606 Lumbee Street, Pembroke, NC. Applications can be
emailed to firstname.lastname@example.org or faxed to (910) 521-8765. Position is open until filled.
PHA complies with the Immigration Reform and Control Act of 1986
AN EQUAL OPPORTUNITY EMPLOYER.
Director of Property Management
Company: Volunteers of America Carolinas
Location: Columbia, SC
Req. Education: 4 year degree
Base Pay: $68,000 - $70,000
Req. Experience: At least 5 years
Volunteers of America Carolinas is a faith based human services organization that provides
affordable housing throughout both North and South Carolinas. Properties in the 1300 unit
portfolio include LIHTC, HUD 202/811 and other types of housing. The Director of Property
Management is responsible for all aspects of property management and is a direct report to the
President/CEO. A Director of Property Management within VOAC has a primary objective of
providing effective professional general management and sound leadership to a team of
property management personnel. The DIRECTOR OF PROPERTY MANAGEMENT is accountable
for creating a team that will distinguish itself within VOA and the industry as being
exceptionally capable of delivering excellent financial performance, client service and resident
satisfaction, while also fulfilling the special human services mission of VOAC. This
distinguished performance will lead to professional growth for the DIRECTOR OF PROPERTY
MANAGEMENT and support the growth of VOAC as the finest not-for-profit human services
organization providing housing and program services to the communities we serve. We are an
equal opportunity employer
For more information, visit: www.voacarolinas.org
Human Services Coordinator III - Housing Specialist
Position available to develop, manage, coordinate, and monitor housing opportunities for adult
MH/DD/SA consumers (persons within the State’s Target population for services) in 8 County
catchment area and expand residential services for persons with severe and persistent mental
illness. Requires Master’s degree from an accredited school of social work and one year of
social work or counseling experience; or Bachelor’s degree from an accredited school of social
work and two years social work/counseling experience; OR Master’s degree in a counseling
field and two years of experience; or four year degree in Human Services field including at
least 15 semesters hours in courses related to social work/counseling and three years
experience. Criminal record, driver’s license and professional license checks will be conducted
on all new employees. Sandhills Center is a drug-free workplace; drug testing is required.
Sandhills Center is also tobacco-free and any use of tobacco products is prohibited on SHC
property as well as during work time. All new employees will be subject to a background and
driver’s license check. Proof of Professional license is required. Sandhills Center offers an
excellent benefits package, which includes vacation and sick leave, as well as health, dental,
life, disability insurance and retirement benefits. Dental, life insurance and retirement benefits
paid. Salary: $34,776-$67,548. NC State applications and a copy of official transcript
required. Applications will be accepted until position is filled. For more information on job
opportunities with Sandhills Center call our jobs line at (910) 673-9111 and ask for extension
301, or visit our web site at www.sandhillscenter.org/jobs/jobs.htm.
PO Box 9
West End, NC 27376
Please email John Niffenegger any announcements or local news articles you would like to
include in our bi-monthly Housing Updates.
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WELCOME NEW OR RENEWING MEMBERS
Chrysalis Foundation for Mental Health
NC Indian Housing Authority
Partnership Property Management
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If you are interested in becoming a Member Spotlight or know of such an organization,
please email John Niffenegger.
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THIS WEEK’S ARTICLES
Fed chief: Housing to drag economy
The News & Observer
The Associated Press
October 16, 2007
NEW YORK - A deepening housing slump probably will be a "significant drag" on economic
growth into next year, and it will take time for Wall Street to fully recover from a painful credit
crisis, Federal Reserve Chairman Ben Bernanke warned.
Bernanke once again pledged to "act as needed" to help financial markets -- which have
suffered through several months of turbulence -- function smoothly and to keep the economy
and inflation on an even keel.
"Conditions in financial markets have shown some improvement since the worst of the storm in
mid-August, but a full recovery of market functioning is likely to take time, and we may well
see some setbacks," Bernanke said in a speech to the New York Economic Club.
It was Bernanke's most extensive assessment of the country's current economic situation since
the August turmoil unhinged Wall Street.
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Local developers weather housing slump
Realtors cautiously optimistic but wary of any changes
The News & Observer
Jim Wise, Staff Writer
October 13, 2007
The national housing bubble is hissing. "Credit crunch" and "subprime mortgage" have settled
into the popular lexicon, and the word "recession" is being heard in polite company.
But Durham developers and sellers say they're doing OK and knocking on wood.
Architect Scott Harmon sounds bullish talking about the Mangum 506 condominiums he
expects to start building next month. Fourteen of his 22 units are pre-sold, and he just needs a
few more signed contracts to break ground.
"Really, everything is in place at this point," he said.
Realtor Laurie Wilson sells condominiums downtown. She sounds bullish, too, but she admits
that, lately, "We've had a few deals go south.
"We feel like we have a lot of professional folks that have a lot of income, but some [observers
of real-estate trends] say we've lost one-third of our buyers."
Debbie Compton at the city Inspections Department said the last four months have seen a
decline in new building. The city issued 202 building permits in June for single-family homes in
Durham County. The rate has steadily fallen since then: 154 in July, 150 in August and 122 in
"The weather isn't the same all over the country, and neither is the housing market," said
Sheila Willis, executive vice president of the Durham Regional Association of Realtors. "We still
have a very strong job market and a healthy economy."
Banker Harold Parker said he is "cautiously optimistic." And Andy Rothschild, one of the major
players in downtown redevelopment, said he's not seeing any local effects of economic jitters
"Our projects in our little corner of the world ... We're feeling OK," he said.
Rothschild has turned the former Clark & Sorrell garage on Foster Street into a biotechnology
lab and a building down the street into a studio/gallery/restaurant mix. He has projects under
way at the Venable Tobacco complex on Pettigrew Street and the Golden Belt factory in
Edgemont, another pending at Heritage Square in Hayti and "a very significant mixed-use
project" in the early stages for the Elkins car lot by the Durham Freeway.
"We've not had the overbuilding here, both in the condominium and office markets," that
happened in other parts of the country, he said. That has left Durham with room to grow and
Unlike major cities in California, Florida and New York, real-estate demand in Durham has been
"slow and steady," said Eugene Brown, who owns a real-estate firm and is a member of the
"We haven't seen double-digit inflation ... appreciation ... like some of those did," he said;
eventually, such rising "values" price buyers out of the market. Still, he said, Durham isn't
immune to what's going on elsewhere.
"We're starting to feel the effects," he said. "We're one of the last. ... There are 20 percent
more houses on the market now than a year ago."
Besides falling demand, construction costs are still escalating, he said. That squeezes private
developers, as well as the city's long list of capital projects: the $110 million bond issue voters
approved two years ago is now worth $85 million, Brown said.
"We're having some apprehensions about higher-priced houses in Durham -- over $500,000,"
said Frank Ward, a Durham real-estate broker since 1960; but the market may not be long in
"The months of July and August were a little slow," said Preston Edwards, president-elect of
the Durham Realtors. "We are beginning to see folks coming back to the markets, in terms of
coming to our showings. ... Here in the fourth quarter we'll probably see a spike in activity."
Parker, co-founder and executive vice president of Durham's Cardinal Bank, said Cardinal
steered clear of the subprime (a euphemism for "substandard," according to Ward) market,
and is "ready, willing and able to make loans that make sense."
"But we have seen, one, a decline in loan demand and, two, the requests we are seeing are
not the quality we have seen in time past. ... Our portfolio has basically been flat for a year or
"We haven't seen a lot of loan chargeoffs, but we've not grown any."
Parker is one of those knocking on wood.
And Alan DeLisle, the deputy city manager for economic development, said, "So far, so good.
"In terms of the developers that I basically deal with, I'm not seeing them pulling back, it's full
steam ahead," DeLisle said. He added, however, "Things can change quickly."
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HUD proposes to close a mortgage loophole
The News & Observer
October 23, 3007
For a decade, credit-challenged homebuyers have used a regulatory loophole that lets them
get Federal Housing Administration mortgages without putting their own money down, while at
the same time avoiding costly subprime loans. About 7,000 buyers per month were exploiting
the loophole, and now the feds are squeezing it shut.
The new policy means that prospective homebuyers with marginal credit will have to act
quickly if they want to buy houses without putting any money down. Otherwise, they will have
to save for down payments or wait for the FHA to roll out its own zero-down program.
At issue is a controversial method of scraping together the down payment for a house. Many
subprime lenders require down payments of at least 5 percent. That's a high hurdle for people
who already have credit problems; luckily for those borrowers, loans insured by the Federal
Housing Administration require smaller down payments -- as little as 3 percent.
Lenders mandate down payments for several reasons, the main one being that borrowers are
less likely to stop making monthly payments if their own money is at risk. To make sure that
borrowers have something to lose, no lender allows sellers to make down payments on behalf
of buyers. But for FHA-insured loans, there has been a way to get around that seller-funded
The FHA allows homebuyers to accept gifts of down-payment money from nonprofit
organizations. There's your loophole: Since the 1990s, the FHA has grudgingly allowed home
sellers to "contribute" money to nonprofits, and for the nonprofits to then "donate" the money
to homebuyers. In effect, sellers could fund buyers' down payments, which was a no-no, but
the enterprise was technically legal because the money was shuttled through nonprofits. The
nonprofits collected service fees from sellers.
From 2000 through 2006, more than 650,000 buyers got their down payments through
nonprofits, representing about one-third of FHA loan volume.
There was a problem, though: studies commissioned by the federal housing department and
Congress concluded that these loans were riskier than FHA loans that didn't involve down-
payment gifts. This fall, after years of debate, the Department of Housing and Urban
Development adopted a rule that prohibits the down payment money from coming, directly or
indirectly, from the seller. HUD administers the FHA. The rule takes effect Oct. 31.
The down-payment industry has come to be dominated by two nonprofits: AmeriDream, in
Gaithersburg, Md., and Nehemiah Corp. of America, in Sacramento, Calif. Both have asked
federal courts to block HUD from enforcing the rule. The housing department won't comment,
other than saying it will defend itself in court.
"HUD completely disregarded any effort to fix the problems and improve the program," says
Ann Ashburn, president of AmeriDream. Among the improvements she suggests: prohibiting
sellers from inflating their sales prices to make up for their down-payment contributions and
requiring property appraisers to include the down-payment gifts in their assessments.
If the new regulation goes into effect on Halloween, it would immediately end down-payment
assistance grants from AmeriDream and all its competitors except Nehemiah. Scott Syphax,
president of Nehemiah, says his nonprofit won an automatic extension as a result of litigation
against HUD 10 years ago, so Nehemiah will be able to serve as a conduit for down payments
until March 31.
The heads of AmeriDream and Nehemiah say the new rule is shortsighted.
"This particular rule couldn't have happened at a worse time for working families and for the
economy itself," Syphax says. "Over 10,000 homeowners are created every single month
utilizing this program. Those people immediately will no longer be served."
HUD disputes that the new rule will harm the economy, saying in a regulatory filing that it "will
have a positive impact on the housing market and on the economy by reducing the number of
mortgages that would otherwise default and go into foreclosure."
Ashburn and Syphax say they are outraged that HUD would publish the new rule while the
House and Senate are weighing FHA reform. House bill 1852 would bar HUD from
implementing the rule and would allow FHA to insure zero-down mortgages. A Senate bill
would allow HUD to implement the rule and would lower the down payment requirement to 1.5
percent from 3 percent.
If FHA reform becomes law someday -- and that's not a sure thing -- the minimum down
payment is likely to be lowered from the current 3 percent. In the meantime, people who want
FHA-insured mortgages will have to save up that 3 percent down payment, apply at Nehemiah
before next March, or hope Nehemiah or AmeriDream win their court challenges.
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Beazer to restate financials after finding lending improprieties
The News & Observer
Harry R. Weber, AP Business Writer
October 11, 2007
ATLANTA - Beazer Homes USA Inc., which faces federal investigations of its business practices,
will restate financial statements for a three-year period after an internal probe found its
mortgage origination unit violated federal lending rules, the company said Thursday.
But the Atlanta-based company said the cumulative impact of its restatements will likely be an
increase in profit, though it can't say exactly how much at this time. It also said the
restatement will not cause an adjustment to the company's current cash position.
Beazer also released selected financial data for its fiscal fourth-quarter of this year, showing
that for the period ending Sept. 30 home closings fell 39 percent from a year ago and net new
home orders dropped 52 percent. It said it had more than $400 million in cash on hand at the
end of the quarter.
Beazer's shares, which have been battered in recent months amid the turmoil that it and the
housing sector have faced, rose 20 cents, or 2.01 percent, to close at $10.13 Thursday. Their
52-week high was $48.60.
Beazer said its internal inquiry by its audit committee found evidence that employees of its
Beazer Mortgage Corp. subsidiary violated U.S. Department of Housing and Urban
Development regulations relating to down payment assistance programs.
The company said it doesn't know exactly what its future liability will be from the misdeeds,
but its projections put the figure possibly in the range of $8 million to $15 million.
Beazer said it will attempt to negotiate a settlement with federal officials to quantify its
financial exposure. The company said it may have to pay fines and provide reimbursement for
losses arising from some mortgage defaults.
The results of the inquiry are preliminary and could be adjusted later, Beazer said.
As for the restatements, Beazer said it will restate its financial statements relating to fiscal
years 2004 through 2006. The restatement is also expected to affect the financial results for
fiscal years 1999 through 2003 and the company expects that it will reflect the impact of
financial results for those prior years as part of the opening balances in the financial
statements for the restatement period.
While the overall impact of the restatements will boost profit, Beazer expects a decrease in
profit for the 2006 fiscal year.
Beazer said it will report its financial results for this year's fourth quarter after it finishes its
restatement or sooner, if possible.
Beazer previously disclosed that its former chief accounting officer may have inflated reserves
and other accrued liabilities in earlier periods.
It also previously disclosed that it received a subpoena from the United States Attorney's office
in the Western District of North Carolina, seeking the production of documents focusing on the
company's mortgage origination services. The Securities and Exchange Commission has
launched a formal investigation of Beazer to determine whether any person or entity related to
the company violated federal securities laws.
A lawsuit filed by 10 homebuyers said fraudulent tactics were so pervasive in a Beazer housing
development in Charlotte, N.C., that corporate management must have participated or
condoned the approach.
An analysis by The Charlotte Observer showed that at least 14 of 98 homes in the Oak Hill
neighborhood fell into foreclosure, a 14 percent foreclosure rate. Nationally, less than 3
percent of home purchases end in foreclosure. The newspaper also reported that 10 of
Beazer's subdivisions in Charlotte had rates of 20 percent or higher.
The company has said it is cooperating with the inquiries. Beazer said Thursday that it has
turned over the interim results of its internal investigation to both the U.S. Attorney and the
Last month, Chief Executive Ian McCarthy said Beazer is cutting costs and offering discounts to
weather the downturn in the housing market and is prepared to downsize further if needed.
He said the company may pull back from some positions and potentially some markets in the
short-term, with hope for growth in the long-term.
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Foreclosure filings nearly double
The News & Observer
Alex Veiga, AP Business Writer
October 11, 2007
LOS ANGELES - Foreclosure filings across the U.S. nearly doubled last month compared with
September 2006, as financially strapped homeowners already behind on mortgage payments
defaulted on their loans or came closer to losing their homes to foreclosure, a real estate
information company said Thursday.
A total of 223,538 foreclosure filings were reported in September, up from 112,210 in the
same month a year ago, according to Irvine-based RealtyTrac Inc.
The number of filings in September was down 8 percent from August's 243,947, the firm said.
Despite the sequential decline, the September figure represents the second-highest total for
filings in a single month since the company began tracking monthly filings two years ago.
"August was an extraordinarily high month for foreclosure activity, so some falloff was almost
predictable," said Rick Sharga, RealtyTrac's vice president for marketing.
The filings include default notices, auction sale notices and bank repossessions. Some
properties might have received more than one notice if the owners have multiple mortgages.
Typically, borrowers must be 60 to 90 days past due on their mortgage payments before their
lender will consider them in default, the first stage of the foreclosure process. If a homeowner
can't find a way to get current on payments, the home is then often put up for auction, and if
it doesn't sell, it eventually goes back to the bank.
In all, 39 states saw a decline in foreclosure filings, the firm said.
Sharga noted that there was a spike in the number of bank repossessions in August that did
not occur in September.
It's likely that the sequential decline in foreclosure activity between August and September
was just a blip, not a bellwether of lessening foreclosure filings.
"We don't see September as the beginning of the end in this cycle of foreclosures," Sharga
The foreclosure rate for the nation in September was one foreclosure filing for every 557
households, the firm said.
The U.S. housing market has seen sales decline and home prices fall or remain flat, making it
harder for homeowners who can't afford to make mortgage payments to sell their homes or
Many of those troubled homeowners were among those who took on adjustable-rate
mortgages that are now adjusting to a higher interest rate, translating into payments they
cannot afford to make.
The rising delinquencies and foreclosures this year have led the mortgage industry to tighten
lending standards, further narrowing options for homeowners struggling to pay their mortgage.
Nevada, Florida and California had the highest foreclosure rates in the country last month, the
Nevada reported one foreclosure filing for every 185 households, earning the state the highest
foreclosure rate in the nation for the ninth month in a row. The state had 5,504 filings in
September, down 11.1 percent from August and more than triple from September 2006.
Florida had one foreclosure filing for every 248 households. The state reported 33,354
foreclosure filings in September, down just less than 2 percent from August, but more than
three times greater than September 2006's total.
California's foreclosure rate was one filing for every 253 households. The state reported the
most foreclosure filings of any single state with 51,259, down 11 percent from August but a
fourfold increase from September of last year.
Rounding out the states with the top 10 foreclosure rates last month were Michigan, Arizona,
Georgia, Ohio, Colorado, Texas and Indiana.
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Sun Communities beats housing slump
The News & Observer
The Associated Press
October 11, 2007
NEW YORK - In this dark housing market, Sun Communities Inc. looks like a bright spot. The
manufactured-home park owner survived an industry recession and is poised to benefit as a
foreclosure wave sweeps the nation, forcing many homeowners to seek cheaper digs.
The Southfield, Mich.-based company owns more than 100 communities, mostly in Michigan
and Florida, filled with thousands of manufactured homes. Sun doesn't own most of the
factory-built units but it does own the land and provides the infrastructure - some communities
even boast a club house and pool - in exchange for a monthly lot rent.
It doesn't suit everyone's lifestyle: Manufactured homes, long ago labeled "trailers," have
fought for respect for decades. Back in 1976, the Housing and Urban Development Code
established strict construction and safety standards to guard against flimsy trailers. The
sardine can-like structures then started resembling traditional homes.
Their popularity grew - even though manufactured housing depreciates like a car and, because
the homeowner usually doesn't own the property, Freddie Mac and Fannie Mae won't provide
liquidity to the market.
But when more traditional housing is too expensive or out of reach, manufactured housing can
be a way to achieve the American dream of home ownership.
Even so, not everyone raves about the stock, especially those wanting a quick profit. Sun's net
income was in the red last year and funds from operations, a key real estate gauge, are down
nearly 20 percent from 2002 until 2007. Shares recently traded near $31, down nearly 9
percent from a year ago.
The stock trades at a roughly 15 percent discount to consensus net asset value, compared with
about 2 percent for other real estate investment trusts, or REITs, said Paul Adornato, a BMO
Capital Markets analyst. As a REIT, Sun Communities must distribute at least 90 percent of
taxable income to investors. Since 1994, it has regularly produced quarterly dividends above
45 cents and on Oct. 22, shareholders will reap 63 cents a share for the third quarter.
"That's the whole key to owning this stock," said John Stewart, a Credit Suisse analyst who
labeled Sun "an unloved name in an out-of-favor sector."
The dividend yield is roughly double the REIT industry average, but in the last few years
traditional home builders have eclipsed Sun Communities when it comes to buyers' adoration.
That's because low interest rates and subprime loans helped buyers - even those with poor
credit or with little or no down payment - buy traditional "stick built" homes. With many of
those loans now headed for default, panicked lenders are tightening their requirements and
halting subprime loans, making home ownership impossible for those who can't qualify for or
afford a traditional loan.
The rental market has seen a boost while others have turned to manufactured homes, which
often sell for less. But don't expect the stock to explode in the next few months.
"I would caution that the benefit (the company is) getting is very gradual," Adornato warned.
"It's not going to happen all at once."
In this case, patience might be rewarded, said Stewart, who started covering the company in
July. "Fundamentals are the best they've been in years," he said. "We attribute the
improvement in large part to the collapse of the subprime mortgage market."
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Coalition to help avoid foreclosures
The News & Observer
Martin Crutsinger, AP Economics Writer
October 10, 2007
WASHINGTON - The Bush administration announced a new mortgage industry coalition on
Wednesday aimed at helping homeowners avoid being trapped in a rising tide of foreclosures.
Treasury Secretary Henry Paulson said the initiative would boost financial companies' efforts to
help an estimated 2 million homeowners whose introductory mortgages with low rates are
resetting at much higher rates, just as the housing industry suffers through its steepest
downturn in 16 years.
The House pursued its own plan for helping homeowners, passing a bill to create a federal
trust fund to finance construction and rehabilitation of affordable housing. The measure would
provide between $800 million to $1 billion a year with the goal of creating 1.5 million
affordable housing units over the next decade by funding grants to a variety of housing
The trust fund would be financed mostly from profits Fannie Mae and Freddie Mac, the chief
U.S. buyers and guarantors of mortgages.
President Bush has threatened to veto the measure. The White House and conservative
Republicans argue that it would duplicate a program at the Department of Housing and Urban
Development. GOP lawmakers said that siphoning money from Fannie Mae and Freddie Mac
would amount to a tax on middle-income homebuyers.
The new mortgage industry coalition promoted by the Bush administration includes 11 of the
largest mortgage service companies, representing 60 percent of all mortgages in the country.
Other members are mortgage counseling agencies, investors and large trade organizations,
and Paulson urged more mortgage service companies to join the effort.
"We need greater participation if we are going to get to all those that need help as quickly as
possible," Paulson said at a joint news conference with Housing and Urban Development
Secretary Alphonso Jackson.
The new initiative, dubbed HOPE NOW, follows an Aug. 31 announcement by Bush that the
administration was changing the Federal Home Loan Administration insured-loan program so
more people could qualify for FHA-insured loans.
Democrats said the initiative still falls short of what is needed given the foreclosure crisis
facing the country.
Sen. Charles Schumer, D-N.Y., noted that the National Association of Realtors on Wednesday
revised down once again its forecast for home sales, predicting sales of existing homes will fall
by 10.8 percent this year, a bigger drop than the 8.6 percent decline it forecast just a month
"Unfortunately, the bottom is falling out of our housing market much more quickly than the
administration is willing to stem the tide of foreclosures," Schumer said in a statement.
Schumer and other Democrats in Congress are pushing legislation aimed at helping more
people avoid losing their homes. Some of the bills also would attack predatory lending
practices that critics see as a prime cause for the crisis.
Sheila Bair, head of the Federal Deposit Insurance Corp., suggested last week that mortgage
service companies consider doing broadbased conversions of adjustable-rate loans to fixed-
rate loans if the borrowers were current on their payments and living in the homes.
Estimates are that mortgages resetting from low "teaser" rates could mean an extra $250 to
$300 in monthly payments on the typical $1,200 monthly mortgage payment.
Asked about a more aggressive response, Paulson said it was important that any efforts not
harm lenders' willingness to make more home loans in the future.
"How do we do things to help as many people as possible stay in their homes without shutting
off future financing?" he asked.
Senate Banking Committee Chairman Chris Dodd, D-Conn., said he agreed with Bair's
suggestion that some sort of formula needs to be used to switch homeowners from adjustable
to fixed-rate loans "because the numbers are just so large. Without that, I fear that too many
borrowers may slip through the cracks and simply lose their homes."
The rising defaults, which started in the market for subprime mortgages - loans offered to
people with weak credit histories - roiled global financial markets in August, prompting the
Federal Reserve to cut interest rates last month to ensure the country did not get pushed into
Paulson said the new coalition had created an "aggressive plan to reach more homeowners and
help them find a way to stay in their homes." That plan includes special toll-free numbers that
the mortgage service companies have set up along with mass mailings to inform people of
Industry officials said people worried about being unable to meet higher mortgage payments
must contact their mortgage service companies or credit counseling organizations as quickly as
"Consumers who do work with us have a good chance of finding a solution that will help them
sustain home ownership, especially when the contact occurs at the first sign of trouble as it
enables us to help before the weight of past due payments reduces consumers' options for
staying in their homes," said Michael J. Heid, co-president of Wells Fargo Home Mortgage.
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Down payment aid could soon end
HUD wants to stop program it says leads to more foreclosures
The Charlotte Observer
October 13, 2007
The U.S. Department of Housing and Urban Development wants to eliminate down payment
assistance programs for home loans that it says are linked to high foreclosure rates, including
those in the Charlotte area.
HUD said default rates related to down payment assistance programs are about two times the
rate of those handled without such programs.
"The default rate on those loans was so bad that if they continued, starting this fiscal year,
we'd finally start to pay out more than we'd take in," said Bill Glavin, special assistant to the
Federal Housing Administration commissioner.
FHA is part of HUD. The new rule is to take effect Oct. 31.
FHA loans using down payment assistance programs accounted for about a third of the
313,998 loans the FHA processed last year, according to records.
The FHA requires borrowers to make a 3 percent down payment. This shows borrowers have
savings. It also gives them a stake in the house.
Although lenders are prohibited from paying down payments for buyers, some have gotten
around the law by giving the money to specialized nonprofits, that in turn give the money to
buyers for a fee. Glavin called these deals "pretty shady arrangements that shouldn't be going
Buyers could still get gift down payments from parents or others, Glavin said, "but you couldn't
have it arranged where the seller was involved."
But industry and political opposition cloud the fate of the rule, even as the number of national
foreclosures hit 223,538 in September, a jump of almost 100 percent compared with the same
month last year, according to foreclosure marketplace firm RealtyTrac Inc.
Two nonprofit organizations with core businesses tied to down payment assistance programs
have filed complaints in federal courts to derail HUD's new rule. And a House bill would keep
the program, while a competing Senate bill still being debated would scuttle it.
The House bill, passed in September, also authorizes zero down payment and lower down
payment loans for borrowers who can afford the monthly mortgage payments.
"If you put more restrictions on this, people are not going to be able to qualify for FHA," said
Ann Ashburn, president of AmeriDream Inc., a Gaithersburg, Md., nonprofit that handles down
payment assistance. "They'll stay renters or, worse, go to subprime."
AmeriDream receives the bulk of its funding through home sellers that are paying down
payments for buyers, she said. Severing that pipeline means, "we'd be severely harmed."
In a series in March, the Observer found a high rate of foreclosure in FHA-backed loans in
Charlotte, especially when those loans involved an arranged gift from a charity or nonprofit to
cover a borrower's down payment.
Beazer Homes USA's mortgage subsidiary was among the most active in the FHA home loan
program in the Charlotte region. From 1997 through August 2006, Beazer Mortgage made
2,322 FHA insured loans in the area. Beazer provided down payments for 69 percent of its FHA
borrowers, compared with about 24 percent of FHA borrowers who worked with other
The Observer found that Beazer incorporated the cost of the down payment into the price of
the home in Southern Chase, a Concord subdivision, according to a Beazer sales document and
a former Beazer employee. That left buyers with no equity.
About 61 percent of foreclosures in FHA homes in Southern Chase had loans arranged using
down payment assistance.
HUD, the Securities and Exchange Commission, the FBI and the IRS are investigating Beazer.
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Nation's number of homeless families is up, and growing
The Charlotte Observer
October 12, 2007
Experts say a new report on homelessness in Massachusetts could be a harbinger for
homelessness nationwide. Low wages, high housing costs, a jump in housing foreclosures and
cuts in housing assistance programs have contributed to a sharp rise in the number of families
More Massachusetts families are in shelters now than any time since the start of the state's
family shelter program in 1983. Charlotte and Mecklenburg County leaders should take note,
because families here . Many, like those in Massachusetts, are working-class families who once
were able to fend for themselves.
But as the economy has changed and businesses closed, they've found themselves jobless.
With inadequate education or training, they've been unable to find new jobs to sustain their
families. Many in this area now rely on government assistance basic items such as food and
clothing. They need help with housing, too.
Unfortunately, they're often left wanting. There is an estimated shortage of 12,000 affordable
housing units in Charlotte-Mecklenburg. There's a long waiting list for the few that become
available each year.
The problem came into focus again recently when Charlotte's Emergency Winter Shelter closed
its doors to more than 30 homeless women to prepare to take in men during the winter. The
Salvation Army's 200-bed Center of Hope, the city's largest shelter for women and children, is
already overflowing. Peter Safir, Mecklenburg's homeless services director, estimates that
women and children now make up 40 to 45 percent of Mecklenburg County's 5,000 homeless
persons. Mecklenburg has fewer than 2,000 seasonal and year-round shelter beds.
As Charlotte grows, homelessness is growing, too, yet we've failed to adequately deal with this
issue. Civic, government and religious leaders should work together toward policies that help
keep more people from becoming homeless in the first place.
Such measures as better access to education and job opportunities are crucial. But this
community must also meet the immediate need to find and fund more places for those already
homeless to sleep.
It's good that people here are coming together to strategize around this problem. Nationally,
the number of homeless is up and growing, and on any night 40 percent will be families. We
must do more to help them while they're down -- and more to help them get back on their
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County board approves Hope VI funding
The Fayetteville Observer
John Ramsey, Staff writer
October 16, 2007
The county and city appear to have reached a compromise for splitting a $9.3 million cost in
the Hope VI housing revitalization plan.
The Cumberland County Board of Commissioners unanimously approved Monday giving $4
million for infrastructure — which includes lighting, water and sewer lines and sidewalks — if
the Hope VI project becomes a reality.
The Fayetteville Metropolitan Housing Authority’s application for a $20 million Hope VI grant
needed documentation proving it had $9.3 million in support for the infrastructure. If the grant
is approved, the project will revitalize the Old Wilmington Road community near downtown,
one of the city’s most impoverished areas.
The city originally asked the county for $5.8 million and county staff originally recommended
committing at least $3.1 million. Negotiations last week and early Monday ended with the
county agreeing to $4million, and Fayetteville Mayor Tony Chavonne saying the city and Public
Works Commission could cover the rest.
―We think between the PWC and the city, we can make up the gap,‖ Chavonne said. ―And the
main thing is getting that application filed.‖
The City Council will vote on the grant funding during its meeting Monday. The PWC will also
need to formally approve the plan.
The housing authority plans to submit its application for the grant Nov. 2.
The housing authority just missed receiving the grant last year when it applied. It lost points
because of a lack of detail in outlining the city’s financial role.
―We’re great. We can proceed forward now,‖ Housing Authority Executive Director Dawn
Driggers said. ―We’re just looking for the infrastructure funding from the powers that be.‖
The county will provide its funding up front to avoid debt and interest payments. The money
will come from one-time sources such as the reserve fund for the new Health Department
The Hope VI project is expected to use $113 million in private and public funding to revitalize
the neighborhood and mix public housing with housing for other income levels.
―I feel strongly this is a great project,‖ Commissioner John Henley said after the board
approved the compromise. ―It’s six or eight years later than it should be. It’s an area that
needs to be developed.‖
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County, nonprofit reach affordable housing agreement
The Durham Herald-Sun
Daniel Goldberg : The Herald-Sun
October 15, 2007
PITTSBORO -- Construction of affordable housing in the Briar Chapel subdivision is moving
closer to becoming a reality with the almost-certain approval of a Memorandum of
Understanding between the Chatham County Commissioners and local nonprofit
Under the terms of the MOU, EmPOWERment will act as the developer and administrator for
three existing affordable housing lots within the subdivision that is expected to include 2,389
houses at completion.
"We are really excited about the Briar Chapel program and have been looking forward to it for
a while," EmPOWERment Executive Director Delores Bailey told the commissioners at a work
In compliance with the county's Compact Communities Ordinance, Briar Chapel developer
Newland Carolina agreed to set aside 2.5 percent of the total residential land developed for
Commissioner George Lucier said that the ordinance allows for denser development. In the
case of Briar Chapel, located off U.S. 15-501 halfway between Chapel Hill and Pittsboro, that
means approximately 2,400 houses in a space that would otherwise be limited to
approximately 1,600 houses. Part of the trade-off is that the large scale of development is
expected to yield 50 to 60 affordable over the seven to 10-year construction of the subdivision.
"You will not be able to drive down the street and know that these are affordable housing,"
said Bailey. EmPOWERment plans to apply for various grants to assist in financing.
A Chatham County affordable housing task force has been working to develop a county-wide
policy since September 2005. Lucier said it will be "a while" before an affordable housing
ordinance is adopted.
The MOU with EmPOWERment allows the nonprofit to begin working with Newland toward
construction on the three sites. County Attorney Kevin Whiteheart said the process and results
will provide lessons in how the planned ordinance should be written and enacted.
"This would be a good test case for how that would work," Whiteheart said of the three-lot
The MOU designates EmPOWERment as the agent responsible for "finding and preparing"
qualified buyers, as well as determining their eligibility under U.S. Housing and Urban
Development standards. EmPOWERment will also market the homes and develop a mechanism
for maintaining their affordable status.
Affordable housing applicants must be first-time home buyers living in Chatham County for at
least 12 months. Single applicants can earn no more than $39,900 per year and must occupy
A key concern among the commissioners during Monday's meeting was ensuring that
affordable housing buyers are not able to make unreasonable profits if they decide to sell after
a few years. Whiteheart said it is likely that a Briar Chapel house selling for $120,000 could be
worth significantly more in less than a decade.
The commissioners favored including restrictions on re-sale value within the deed for an
affordable housing lot.
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Habitat to welcome visitors from Guatemala
October 15, 2007
Habitat for Humanity of Goldsboro-Wayne will welcome guests from Guatemala on Thursday.
For every house built in Goldsboro-Wayne County, Habitat for Humanity of Goldsboro-Wayne
contributes a tithe to Habitat International to support builds in other countries.
Habitat of Goldsboro-Wayne has supported Guatemala over the last year and they would like
to invite the public to hear what they were able to do with this support.
The public is invited to join the board of directors and staff at First Baptist Church of Goldsboro
on Thursday at 4 p.m. for a short slide presentation and an opportunity to meet the leaders
who are building in Guatemala.
"This is so exciting," said Richard Koenig, coordinator of International Donor Relations Habitat
Guatemala. He and the executive director of Habitat Guatemala, Luis Samayoa, will be on hand
to answer questions and describe the home-building efforts there.
Habitat for Humanity Goldsboro-Wayne was organized in November of 2001 and has since
partnered with 25 qualified families and the community to build decent, affordable houses.
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