‘Aging in place’ transformed from dream to reality in Ohio

As with other communities across the country, the Rust Belt town of Springfield, OH, is aging. With high unemployment and the resulting exodus of young people, the population of the small town in southwestern Ohio is increasingly in need of affordable housing tailored to the needs of older individuals who want to stay in their communities, but need a little help to do so.

“Springfield is very segregated in terms of income,” explains Tina Koumoutsos, executive director of Neighborhood Housing Partnership (NHP) of Greater Springfield, which celebrated its 20th anniversary in 2013. “Most of the new development is on the north side, where the more affluent residents live. People in the southern neighborhoods don’t have as many options.”

NHP-GS is doing its part to change that, however. In 2011, it partnered with the City of Springfield to leverage funds from the second round of HUD’s Neighborhood Stabilization Program, created to assist communities whose viability is at risk in the wake of the wave of foreclosures. This funding, says Koumoutsos, was a “blessing. We had no debt to service, and could use the project instead to generate a revenue stream to invest back in our work.”

One year later, NHP offered 12 two-bedroom duplexes for rent, specifically for individuals age 55 or older who are making 50 percent of the area median income or less. In addition to reasonable rents, affordability is assured through green building practices that keep energy costs low.

“We designed these units with ‘smart growth’ in mind,” says Koumoutsos, who was the city’s housing coordinator before she became the founding director of NHP. “That means people and their special needs were our focus, not cars.”

For example, the new development was positioned to be “walkable,” with a YMCA, government offices and a performing arts center within easy reach. The property manager of the complex owns another, larger senior-service project and provides case-manager services to both developments, including recreational activities and transportation when needed.

Front porches (without steps, so people with disabilities
can easily access them) are main features of the new
walkable community for seniors.

In the units themselves, garages are positioned to the back of the homes, shifting the focus to front-yard porches where residents are encouraged to socialize with each other. The University of Michigan’s Health and Retirement Study, which is following more than 7,000 individuals, concluded that living in a neighborhood where you have strong social ties has as much physical benefit as not smoking.

In addition, the development was built with a goal of “zero steps.” Koumoutsos explains that NHP wanted the residents to be able to safely age in place, as well as to welcome disabled friends and relatives. That means no stairs that could become wheelchair obstacles, as well as special touches such as walk-in showers in the bathrooms and accessible kitchen cabinets. At the same time, however, the NHP team worked hard to make the look inviting, rather than institutional, and the second bedroom in each unit offers plenty of space for visiting children and grandchildren.

“All of the units filled almost immediately, and we have a waiting list of about 100,” says Koumoutsos. “We are in discussions now with the city about building more, since we own the adjacent land.”

“Impact” is what Koumoutsos and her team strive for. A recent study documented that in the last five years, NHP of Greater Springfield has contributed $43 million to the local economy, supported 74 jobs and generated $51 million in first mortgages.

“We used to have to struggle to make the case that providing affordable housing has an overall impact on the community at large,” she says. “Now no one questions it.”

Written by Pam Bailey, communications writer for NeighborWorks America.

Baltimore group serves community through ‘matchmaking’

Match.com and eHarmony could learn a thing or two from the homesharing service offered by St. Ambrose Housing Aid Center in Baltimore: Even the most sophisticated computer algorithms can’t replace good old-fashioned matchmaking, in which professionals get to know clients one-on-one to decide who would make a good “fit.”

It’s a simple concept: There are homeowners who need help paying their mortgage or other expenses, or just want the company. And there are other people who need an affordable place to call home. Why not match them up?

“The idea of homesharing was ‘born’ in the 1970s as a product of the Gray Panthers movement, and St. Ambrose was among the first housing organizations to join, in 1988,” comments Rebecca Burrett Sheppard, director of the program for St. Ambrose and president of the national association for professionals in this arena. “‘The U.S. census had just shown that more than 35,000 widows and widowers were living alone in single-family dwellings in Baltimore, and homesharing was a way of allowing these older individuals to ‘age in place’ – helping them with both chores and income.”  

St. Ambrose, a NeighborWorks organization that is celebrating its 45th anniversary this year, has seen its homesharing program grow exponentially since those early years, fueled since the 2008 housing crisis by homeowners of all ages who need extra income and seekers who are desperate for an affordable rental option.  To date, the organization has made 1,651 matches, about 65-80 annually.

Odd couples can make good matches

Increasing diversity in the neighborhoods
is often a side benefit of homesharing

Currently, slightly more than half of the participants are earning just 30 percent or less of the area median income, with 43 percent between the ages of 40 and 60 and 44 percent between 60 and 80. More than a third (37 percent) of the matches are intergenerational (with the provider and seeker more than 15 years apart in age). The largest age difference the program has seen so far is 37 years.

One such match is Austin Jones, 86, who now has a 28-year-old housemate.

“I moved to West Baltimore in 1982,” explains Jones. “I bought into a co-op and shared it with my cousin. When he died, it was ok, because I was working. But then I had to retire five or six years ago and my Social Security payments aren’t enough to pay all of my expenses. I’ve been in the St. Ambrose homesharing program ever since.”

Jones has had about five housemates over the course of the years, including two currently. John Pittman, the 28-year-old, moved in about a month ago when his roommate moved out and he couldn't afford to live on his own. Pittman says Jones offers both the affordable rent and privacy he needs, and plans to stay at least until he can pay off his debts.

“All of my housemates have worked out pretty well,” says Jones, adding that his most important criteria are tidiness, a history clean of serious crime and good health. (“I’m too old to be able to take care of anyone,” he explains.) “I give Annette (his St. Ambrose “matchmaker”) an A+. She always finds me good people.”

St. Ambrose staff personally interview every applicant for the program, conduct home visits, check criminal records, verify income and contact four personal references for each potential participant. After the counselor identifies a match, the homeowner and house-seeker meet and decide whether they have good chemistry. If it’s a go, the “matchmaker” helps the two structure a written agreement, stipulating the rent to be paid, how chores will be divided, the policy on guests, etc. Arrangements are always month-to-month, to allow maximum flexibility, and the staff keeps in touch for the first year to help work out any problems. (That’s another feature dating sites could benefit from – follow-up “troubleshooting”!) Although the average duration is 18-24 months, Sheppard says three St. Ambrose matches have been together since the 1990s. There are others, however, that last only a couple of months by design.

“It’s not a requirement, but we do see a lot of diverse pairings work out quite well,” says Sheppard, recalling a quadriplegic widower who welcomed an under-employed IT professional, and a chronically homeless 30-year-old who moved in with a 50-something social worker. “The possibilities are infinite.”

Lessons learned for others

Sheppard has become something of national expert on homesharing, and often consults with other organizations considering starting their own program. In fact, she recently returned from New Jersey, where another NeighborWorks organization is initiating one to help people still struggling to make ends meet following the devastation of Superstorm Sandy.

If you’re intrigued by the homesharing concept, here are a few tips from Sheppard:

1. Dedicate sufficient staff to the effort. To get the program off the ground properly, she recommends one full-time employee.
2. Learn from others when it comes to policies and procedures. Expertise and thoughtfulness are required to develop a success record.
3. Don’t skimp on marketing and outreach. Remember, Sheppard says, you have to identify and “cultivate” two separate customer segments: homeowners and seekers. St. Ambrose relies on tactics such as Craig’s List, public service announcements on local media and outreach to other organizations.
4. Don’t expect huge success in the first year. “These programs start slow, but grow exponentially,” she cautions. “Cultivating a client base can take a number of years, but if you’re successful, you’ll eventually be self-sustaining – a very good place to be.”

What Are Reverse Mortgages Anyway?

This article was jointly produced by the NeighborWorks America National Foreclosure Mitigation Counseling team and the Home Equity Conversion Mortgage (HECM) program team.

We hear a lot about reverse mortgages in the media, but there is a good deal of confusion about what they are and how they work. To begin with, many people refer to “reverse mortgages” in general, when they really mean to speak about those loans offered specifically by the Federal Housing Authority (FHA). This post focuses on these FHA reverse mortgages, also called home equity conversion mortgages, or “HECM” loans.

The idea behind a HECM loan is that many older borrowers are house-rich, but cash poor. Imagine, for example, an elderly retired couple that has long since paid off their home, but lacks the money needed for daily expenses like medicine, gas and food. A HECM loan would allow the couple to use their home’s equity as a form of income. They would borrow against the market value of their home and get cash in return.  To pay off the loan, they or their heirs might sell their home some years in the future or repay with other means.

Advantages of a reverse mortgage include the fact that the homeowner can stay in their home and does not repay the loan until he moves or sells the property, or passes away. At that time, the borrower owes the lesser of the loan balance or the value of the property.  A HECM loan thus differs from a home equity loan in that the borrower doesn’t need to make any payments during the life of the loan. Furthermore, there are no traditional income or credit requirements. To qualify for a HECM loan, a homeowner must be at least 62 years old and own their home free and clear or be able to pay off all existing mortgage debt with HECM loan funds. The homeowner must also talk with a HUD-approved HECM counselor.

An illustration of a successful HECM loan situation might be a family where an aging father wishes to remain in his family home, but lacks savings to be able to pay for all his regular bills. Instead of having to sell his house, the father can stay where he is and continue to be around the people and places that have meant so much to him throughout his life. His children may not be able to keep the family home if the loan is not repaid, but during the father’s life, he may be able to maintain a greater degree of financial independence.

However, HECM mortgages are certainly not for everyone. One big challenge is that they encumber the borrower’s property with debt, which is not in alignment with all cultural values and may complicate or preclude the borrower’s ability to pass the home on to his or her heirs. If the borrower’s heirs are unaware of how the HECM loan works, they may be unpleasantly surprised to find a large debt owed on the property. It’s also possible that an elderly borrower might be alive, but have health issues that prevent him or her from continuing to live in the home. Should the borrower move out, say to a nursing home or to live with family, someone would need to assume responsibility for closing out the HECM loan.  Repayment options include selling the home, repaying the loan or refinancing the loan.

In recent years, some foreclosure counselors have recommended HECM loans as a way for older clients to pay off their debt and remain in place. In these cases, a borrower would take out a lump sum HECM loan, and use it to pay off the balance of their conventional mortgage debt. This would buy the borrower time, but it might not leave the borrower with any extra cash, meaning that they would still need to find a way to pay for their day-to-day living.  Another source of income would be needed — which could be a problem if, for example, the foreclosure was the result of multiple family members losing their jobs.

In all cases, homeowners considering a reverse mortgage should carefully explore whether it is the most appropriate means of achieving their financial ends.  Housing counselors help homeowners clarify their objective and whether a reverse mortgage best fits that goal.  Counselors also ensure homeowners take all fees and charges into account, walk homeowners through the rules to confirm the borrowers understand completely the unique mechanics and risks of this loan type, and help homeowners avoid scams. However, counselors are no substitute for evaluating personal values or talking to family members. Borrowers should think carefully about what choice is best for them, their family and their legacy.

For a list of HUD-approved HECM counselors, visit https://entp.hud.gov/idapp/html/hecm_agency_look.cfm

HECM counselors can also visit www.hecmcounselors.org for more information on HECM Counselor training and technical assistance available from NeighborWorks America.

Collaboration and Innovation for Green Housing Success

By Leila Finucane Edmonds
NeighborWorks America, Director
National Initiatives and Applied Research

Community Housing Partners (CHP) in Christiansburg, Virginia has served low wealth and low-income communities for over 30 years with striking results. CHP has almost 6,000 rental homes in its portfolio, a NeighborWorks HomeOwnership Center and a LEED Silver corporate headquarters. It’s a great example of diversified, resilient and mission-focused organization that has built its strength on being collaborative, open to early innovations and adaptive to conditions in its local markets.

I recently spent two days with CHP Executive Director Janaka Casper and his team. Also on the trip were Michelle Winters, NeighborWorks America Green Strategies senior manager, and David Dangler, NeighborWorks America Rural Initiatives director. Our goal was to learn more about their successes, and, in particular, their New River Center for Energy Research and Training. The center is one of only a small number of Department of Energy Legacy Weatherization Training Centers, and the first to be accredited by the Interstate Renewable Energy Council for energy efficiency training. CHP has trained more than 30,000 people at the center for jobs like retrofit installers, energy auditors, quality control inspection – so I wanted an on-the-ground view of operations. 

Grandma's House

Touring the facilities, we were able to see demonstrations on uniquely designed pressure houses, how to perform blower door tests on multi-family buildings and model homes for hands-on-training – a manufactured home and “Grandma’s House,” a model frame house.   Overall, I was impressed by CHP’s integrated use of technology in their training programs, their commitment to sustainable practices and the talent and breadth of their leadership team. 

During our visit, I heard moving stories about what CHP has accomplished, including that of CHP’s first multi-family project, a housing complex for seniors.  Back in 1980s, school consolidation was common in rural areas – and Pembroke, Virginia was no exception. When the local elementary school closed, one of the planning district commissions, which act as development consultants for local government, invited CHP to help redevelop the property. CHP successfully applied to convert the property into affordable senior housing and named the complex for Sam Robinson, a former principal of the original school.

S.A. Robinson building. The entrance still reads "Pembroke School"

CHP converted the 660 square foot classrooms into apartments of a similar size. CHP also worked to retain the character of the building. For example, CHP made chalkboards into tables where people could place their keys.  “Green housing” wasn’t much discussed in the 1980s, but CHP was conscious of energy efficiency – all windows were double glazed to more effectively regulate indoor temperature.

Residents of S.A. Robinson

The project was finished in 1987 and it is now a major resource for this small community. It provides 27 apartments for seniors making 80 percent or below federal area median income. Some of the early residents turned out to be graduates from the school. Janaka is most proud of CHP’s long-term ownership. Residents feel at home and nearly every door is decorated with crafts that express a personal sense of belonging.

On the drive back, my team and I spoke about further exploring and highlighting connections between our green program for NeighborWorks network members and our affiliates serving rural communities. Our goal is for two thirds of the NeighborWorks America network to adopt sustainable and energy efficient practices across their operations. With this visit, we are gaining a new understanding of the energy efficiency and weatherization work already underway in local markets and regions. Now, we look forward to collaborating with the network creatively to expand and share that knowledge.