After living in subsidized housing for 11 years, Yvonne Hill-Harris owns her own home. “It’s still hitting me that it’s mine,” she said.
Subsidized rent was “very secure,” said Hill-Harris, explaining she only had to pay one-third of her income for housing during those years. “But it can get too comfortable,” she adds. “It can be a curse.”
Sharon Elders swore she would never buy in the city. “There’s too much going on,” Elders said, referring to noise, crime and violence in the urban landscape.
Yet Elders, a longtime high-rise renter from the North Side, changed her mind after seeing new single-family homes in Austin developed by City Lands Corp. Elders and her husband, Steve, bought one of the homes earlier this year, and the couple has been pleasantly surprised about the sense of community. “Last weekend everyone was out barbequeing, inviting each other over,” Sharon Elders said.
“(But) the first 30 days, I was ready to leave,” she said, explaining that the unfamiliar sounds of the house settling woke her at night. “Now I wouldn’t trade it for anything in the world. It’s renewed my view about living in the city.
Hill-Harris and the Elders are just two families that have been drawn into the ranks of homeownership through the city’s New Homes for Chicago, a program that is starting to rack up success stories following more than four years of planning and groundwork.
“It’s rewarding the working people who nonetheless are having a tough time,” said George Thrush, head of the Thrush Companies, a private real estate firm that has been involved in several New Homes for Chicago projects, both as a builder and a joint-venture partner.
Started by Mayor Daley in 1990, New Homes for Chicago was conceived to encourage new construction in inner-city neighborhoods that had not seen building in many years, including Austin, Humboldt Park, North Lawndale, Pilsen, South Chicago, South Shore and Uptown.
But the program is as much about rebuilding communities as it is about building houses, and it is on that score that the early results seem most promising.
“I’m putting my money where my mouth is,” said Hill-Harris, who works as an activity coordinator for Voice of the People, the not-for-profit group that developed 28 new homes in Uptown. “I’m investing in myself and my family’s future.”
Indeed, the vast majority New Homes buyers are first-time owners, a fact that bodes well for the areas they are moving into, experts say.
“New people come in with new energy,” said Denise Roman, a neighborhood director of Neighborhood Housing Services of Chicago, a not-for-profit group, which, along with Thrush Companies, has helped develop 15 single-family homes in West Humboldt Park with financing approved for another five.
“They do a lot of things existing homeowners don’t,” including founding block clubs and community organizations or reviving lackluster groups, she said.
In some neighborhoods, the new houses are scattered. In other areas, such as Austin, on the West Side, construction is concentrated with 35 of the 40 New Homes on Quincy Street.
Either way, said observers, the new construction is an immediate shot in the arm, aesthetically speaking. That’s especially true when the new house replaces a vacant lot, which typically may have served as a breeding ground for garbage and gang activity.
“Just symbolically, building a new house creates hope that things are changing,” said Joseph Neri, associate director of Pilsen Resurrection Development Corp. (PRDC) “Each time a house goes up it’s people claiming a victory.”
The victories can be more than symbolic; active community organizations can help combat crime, agreed many housing experts.
In Pilsen, three homes went up and the new homeowners got involved with a community policing program. Their efforts, along with other community members, were instrumental in a large drug bust, ending control a gang had on the block, Neri said.
“The thinking seems to be that if someone is building new houses in this neighborhood, there must be value here,” said Jeff Welsh, vice president at Bigelow Homes, which is handling construction for PRDC’s second round of homes in the Pilsen area.
What’s more, the new construction ignites additional development by encouraging existing homeowners to make improvements to their property. “It creates a snowball effect,” Roman said.
Cases in point: seven existing homeowners on the 3300 block of West LeMoyne installed new fences after three New Homes for Chicago went up across the street, Roman said.
In Uptown, many existing homeowners began watering their grass for the first time when new construction began. Soon afterward, flowers were planted and people started picking up garbage off the streets, reported Hill-Harris. “These homes are giving hope,” she said. “We are taking back our neighborhood.”
Even where houses can’t go, the rebuilding spirit can.
In Austin, City Lands developed a garden on one of the lots it owned between two multifamily apartment buildings. Through a federal HUD grant, the group was awarded $10,000 that went to build 12 raised beds with vegetables and flowers as well as planting trees, bushes and shrubs in the lot.
“The garden has helped galvanize the entire neighborhood, especially the children,” said Carolyn Peters, project coordinator for City Lands.
In some areas where New Homes for Chicago has put up homes, commercial development is also showing signs of stirring.
In Austin, Walgreens Drug Stores opened a new store at 5222 W. Madison St. last summer. The housing program played a role in the decision, officials said.
“It assured us that positive things were happening in the neighborhood. It’s an area that’s moving forward,” said Michael Polzin, a spokesman for the Deerfield-based drugstore chain.
And construction for a new Moo & Oink grocery store is going on at 4848 W. Madison, with the 25,000-square-foot building slated to open this fall. Although the grocer has been planning to build on the site for about four years, Quincy Homes has been “a definite plus,” said Barry Levy, president of Moo & Oink.
And Thrush believes New Homes will be the catalyst for more market rate houses in these neighborhoods.
“It’s a small number of homes, but has tremendous impact,” Thrush said. “Nothing makes you have a sense of community more than homeownership.”
The program helps break down the traditional barriers to homeownership in two ways.
By providing direct cash subsidies for construction-typically $20,000 for a single-family house and $32,000 for a two-flat-to private home builders, New Homes for Chicago can be sold for prices ranging from about $77,000 to $93,600, far lower than the cost of conventional new construction.
Most of the lots on which the homes are built are owned by the city, which transfers them to the developers for $1 each.
The program also provides more favorable financing through community banks. Although terms vary, typically a lower down payment of 5 percent is available. Also, the city’s Department of Housing, which administers the program, soon will start to provide up to $2,000 in closing costs assistance.
The only restrictions are that buyers can earn no more than 120 percent of the median area household income (about $57,100 for a family of four) and must stay in the home for four years. If they sell sooner, they are required to repay the city contribution.
Despite city funds, New Homes for Chicago does not work like federal subsidized housing programs, in which residents pay only a portion of their market rent. With the New Homes program, homeowners pay the full cost of mortgage payments.
To date, about 170 single-family homes have been built under New Homes for Chicago, with another 36 under construction and financing approved for another 121, making a total of 327 homes.
“The middle class is not going to come out of the suburbs en masse to live,” said Hipolito (Paul) Roldan, president of Hispanic Housing Development Corp.
“This program is a chance to keep middle-class folks in the city,” said Roldan, whose not-for-profit group helped build 19 homes in Humboldt Park with New Homes for Chicago funding.
While some groups have made considerable progress-PRDC has completed 25 homes in Pilsen where it hopes to eventually build 120 homes-marketing has been tougher going for other groups, particularly on the far Southeast Side, where crime is a major stumbling block.
At Guadalupe Homes in South Chicago, financing has been approved for 25 homes for more than a year, but only three homes have been built, with two more under contract.
Yet the tide appears to be turning. At a recent neighborhood fair, more than 45 people toured the model home at 9010 S. Brandon Ave.
“Once people get in the door it’s a much easier sell,” said Donna Drinan, executive director of the Claretian Associates Neighborhood Development Office, the not-for-profit group spearheading the project.
Indeed, with nine-foot ceilings, full basement, three bedrooms, two full baths and a slew of closet space, it’s hard to believe the 1,448-square-foot model home sells for $77,000.
In South Chicago and many of the areas where New Homes for Chicago are being built, home buyers may also qualify for a city tax savings program under which qualified buyers can subtract 35 percent of their annual mortgage interest (not to exceed $2,000) directly from their federal tax bill. That makes the home even more affordable, experts said.
Even with the small number of homes up in South Chicago, neighbors have already begun sprucing up their properties, Drinan said.
The designs of New Homes vary from neighborhood to neighborhood. Care has been taken to make new buildings compatible with existing architecture in an area, said a spokeswoman for the city’s department of housing.
At Quincy Homes in Austin, for example, New Homes were given pitched roofs whereas flat roofs fit in better in North Lawndale, said Kristin Dean, vice president of The Shaw Co., parent of Shaw Homes. Shaw Homes, in partnership with Sears, is currently building 24 New Homes in North Lawndale.
Outside, design emphasis has been placed on the front to ensure strong curb appeal, explained George Pappageorge, a principal with the architectural firm Pappageorge Haymes, which designed three of the New Homes projects. And, to avoid cookie-cutter looks, buyers are given options on exterior details.
Currently, New Homes for Chicago is targeted to families who earn 80 to 120 percent of the median area income.
Yet the Department of Housing is working on even deeper susbidies to reach out to even lower income families.
The new program, which housing commissioner Marina Carrott affectionately dubs “Son of New Homes,” should help folks earning only 50 to 80 percent of the median area income achieve ownership.
“(The price of) $75,000 to $95,000 is still beyond the reach of many households,” Carrott said.
The Department of Housing is putting final touches on the program’s design, and the next step will be winning city council approval, he added.
