What strategies work best in rural areas and weak markets?

What strategies work best in rural areas and weak markets?

Housing needs are not confined to high cost markets. Housing needs are more pervasive, affecting families in all types of markets and in many regions throughout the country. In weak markets or in rural areas, home prices and rents are lower, but affordability still is an issue when low wages and salaries are insufficient for families to live in their homes without spending an excessive portion of their income. Some housing may be dilapidated because weak market conditions discourage their owners from investing in upkeep and maintenance. And today, some communities have been particularly hard hit by foreclosures among homeowners.

Strategies to deal with these problems will differ from place to place, but much can be done to address these problems. Resources available nationwide, such as Low Income Housing Tax Credit and financing programs of the Federal Home Bank system, as well as state allocations of funding through the Community Development Block Grant and HOME programs, can be used to create more affordable homes in rural areas. Rural Development (RD), an agency in the U.S. Department of Agriculture, operates the Section 515 program which provides low- cost mortgages for property owners to develop rental housing for the lowest income rural Americans. The agency also administers the Section 502 loan program to help low- income families purchase, build, repair, or renovate homes. Funds also may be used to refinance debts when necessary to help families avoid losing a home.

To promote homeownership, many rural communities have had great success with the Self- Help Opportunity Program (SHOP). This program enables low- income participants to build their own homes, usually working together in groups on their neighbors’ houses at the same time. Homebuyers use their own “sweat equity” to reduce the cost of their homes. Habitat for Humanity has successfully applied the self-help housing model throughout the country, and in the process become one of the nation’s largest home builders. Many communities work closely with Habitat for Humanity and other self- help developers to provide free or low- cost land and other support.

Early intervention, including financial counseling, emergency loans, and refinancing can help families forestall and prevent foreclosures on their homes.