The decision is part of a larger affordable-homeownership plan, while a competing proposal asks the Housing Authority to compare the financial impact before more properties are transferred.
The Salem Housing Authority voted Monday to seek federal approval to transfer nine publicly owned housing properties to Habitat for Humanity at 15% of fair market value.
The nine properties are part of a much larger plan involving 79 scattered-site housing units owned by the Housing Authority. Forty-six are expected to be offered directly as affordable homeownership opportunities. Another 33 have been identified for reduced-rate sales through a nonprofit partner, with Habitat for Humanity currently designated for that role.
The financial difference between the properties’ estimated value and their proposed sale price has drawn attention from Commissioner Shane Matthews and the Mid Valley Association of REALTORS®.
Matthews’ proposal uses a staff-provided property list showing the 33 properties designated for a third-party provider have an estimated market value of about $8.76 million. The proposed sale price is about $1.31 million.
That works out to 15% of market value, leaving a difference of approximately $7.45 million between the estimated value of the properties and what the Housing Authority would receive from the sales.
Rather than moving ahead with the same approach for the broader portfolio, Matthews has asked the Housing Authority to study another option.
His proposed Salem FirstKeys Fund would sell properties at or near fair market value, subject to legal and federal requirements, and place the proceeds into a restricted interest-bearing fund. The principal would remain in the fund while the earnings would be used for zero-interest homebuyer assistance loans for eligible buyers purchasing homes in Salem.
Matthews’ proposal does not direct the Housing Authority to adopt that model. It calls for staff to determine whether it is legally and financially workable and compare it with the current plan before additional decisions are made.
The Mid Valley Association of REALTORS® also prepared a letter urging commissioners to conduct that comparison.
In the letter, MVAR said transferring properties at 15% of fair market value represents a significant public investment and argued commissioners should know how much equity is being transferred, what a market-rate sale could generate and how many future homebuyers could potentially benefit from an ongoing assistance program.
The association also made clear that its position is not an objection to Habitat for Humanity.
“Supporting the motion is not a vote for one model over another,” the letter states. “It is a vote to obtain the information necessary to make an informed decision.”
Habitat’s involvement is intended to create affordable homeownership opportunities. Some of the 33 properties need repairs or redevelopment, while others sit on lots that could potentially accommodate additional housing. Salem Housing Authority planning documents say Habitat would be expected to repair, replace or redevelop those properties while keeping them tied to affordable homeownership.
The Housing Authority’s Monday action does not complete the transfer of the nine properties. Federal approval from the U.S. Department of Housing and Urban Development is still required.
Matthews’ proposal, meanwhile, puts a second option on the table as Salem considers what to do with the rest of its scattered-site housing portfolio.
