Op-Ed: As Home Prices Skyrocket, Some Programs Offer Help

“LI HOME PRICES GO UP, UP, UP,” declared the front-page headline in Newsday last week. The article began: “Home prices reached a new high in Suffolk County…The median home price jumped to $535,000 in Suffolk last month…”

And that was $10,000 more than what Peter J. Elkowitz, Jr., president and CEO of the Long Island Housing Partnership, said that the average price—$525,000—of a house in Suffolk had just gone up to. He was giving a presentation earlier in the month before Long Island Metro Business Action on “Affordable Housing, Opportunities & Obstacles.”

Houses suddenly now at a median price of $535,000—quite an obstacle in finding affordable housing!

What existing governmental programs are there available for people seeking help in purchasing a home in Suffolk?

On the federal level, there’s the Federal Housing Administration, now part of the U.S. Department of Housing and Urban Development, “helping people become homeowners since 1934,” notes HUD’s website. “How do we do it?” Because the FHA “insures the loan…your lender can offer you a better deal,” it says. And with an FHA loan there are “low down payments.” It continues: “Buying your first home? FHA might be just what you need. Your down payment can be as low as 3.5% of the purchase price.” And there’s “low closing costs, easy credit qualifying.”

We obtained an FHA loan to buy our first home decades ago in Suffolk—for $19,000, the total not even twice the $10,000 price increase. Our FHA guaranteed 30-year 3% mortgage cost $200 a month. But for a house in the now median $535,00 range in Suffolk, affording a mortgage is difficult. Even with currently low interest bank rates, for a 30-year mortgage at 3%, the payments would be $2,108 a month, according to “Mortgage Calculator” online.

Various websites market houses on which owners couldn’t keep up mortgage payments and thus they got foreclosed. “Houses priced from $10,000,” several websites featuring such housing claim. But in these parts, there are no houses on which mortgages were foreclosed at even close to that price. I inputted Huntington on www.foreclosure.com and the houses are listed at between $391,000 and $1 million.

As to state programs, the HUD website outlines “resources” and under “Homeownership: New York” are the encouraging words: “Owning a home is a big part of the American Dream.” There is a section on “Getting Started” which notes that in New York State there are state “assistance programs—resources and programs to help you buy and maintain a home.”

One is run by the State of New York Mortgage Agency which describes itself as offering “low-interest mortgage loans and programs to help qualified buyers purchase their first home. SONYMA provides access to affordable homeownership by removing many of the hurdles faced by first-time homebuyers. From increasing your understanding of the overall homebuying process, to helping secure funds for a down payment, SONYMA is with you every step of the way.”

As for Suffolk, its government website says: “Suffolk County operates several programs to support and encourage the creation of affordable and workforce housing through the Department of Economic Development and Planning and the Suffolk County housing opportunities programs.”

These include the county’s Affordable and Workforce Housing Land Acquisition program in which it “partners with developers…and will reimburse the developer for infrastructure costs when construction is completed to reduce the cost burden and allow developers to charge less for the rent or purchase price of newly constructed or rehabilitated units. Eligible infrastructure improvements include, but are not limited to roads, parking, sewers, water, sidewalks, street lighting and appurtenant landscaping within the development area.”

Then there’s the county’s Section 72(h) Affordable Housing Transfer Program. It provides for “the county to transfer parcels currently in the county’s real estate inventory”—taken because of non-payment of taxes—”to municipalities for the construction or rehabilitation of affordable housing.”

Jim Morgo related last week how he “came up with the concept” in 1987 as Suffolk’s deputy county executive for housing. “Since then, countless properties—the most expensive items in building homes—have been conveyed from the county to towns and villages and then to groups like the Habitat for Humanity and the Long Island Housing Partnership at no cost, and affordable homes have been created on these transferred properties.”

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