Drive by one of the nine Habitat for Humanity houses in Newton, and at first glance, you likely won't notice any differences from the other homes in the neighborhood. With porches, garages and many common housing amenities, the residences easily blend into the groups of homes around them.
However, there's a deeper story behind each of these houses: a story of volunteers who have spent thousands of hours constructing the buildings; local businesses who have donated hundreds of dollars worth of paint, flooring and other supplies; and a family whose once impossible dream of owning their own home has now come true.
“It’s something we’re very proud of," representative Harry Wolfe said of the program, which has operated in Harvey County for 16 years. “... It's designed to provide housing to people that might not otherwise be able to obtain housing.”
He spoke at Tuesday's Newton City Commission meeting and asked city officials to consider allowing the program to use city grant funds to construct more homes.
Wolfe said people sometimes have misconceptions about Habitat for Humanity homes. Families must submit applications, which are evaluated based on the family's size and income, and their inability to obtain adequate housing through conventional means. The family also must be able to demonstrate they can pay the mortgage, taxes, insurance and other monthly expenses.
“There are a lot of folks on the street who believe it’s a free house, and it’s not," Wolfe said.
The cost to build a new habitat home is about $80,000. The actual cost of building the home is the amount of the first mortgage, and the difference between the cost of building and the appraised value is the second mortgage. The mortgage is paid back on a 0 percent interest loan over a 20-year period. Each year that all payments are made on time, 10 percent of the second mortgage is forgiven.
“It’s a reward for the responsibility of home ownership, honoring a commitment," Wolfe said.
There is a required $1,000 down payment before construction begins. Taxes and insurance are escrowed and paid like a regular home loan.
Families also are asked to help with the construction of the home. Every adult family member must contribute at least 250 hours of volunteer work. Friends and relatives can join in and donate their hours toward the family's minimum 500 hours of "sweat equity."
The organization's goal is to construct one home a year, and they estimate once they reach 25 homes, they will have a revolving revenue stream to support the building of subsequent homes.
On behalf of the organization, Wolfe asked if the city would consider allowing Habitat for Humanity to use community development block grant funds to help finance new home construction projects. He said it could help the program in tough economic times.
“With the economy the way it is, donations get a little tighter," he said.
According to Tim Johnson, assistant city manager, the flexible community development block grant program provides communities with resources to address development needs.
Harvey County Habitat for Humanity is requesting $180,000 be made available to them as a loan that would be repaid.
Commissioners authorized city staff to continue researching the possible partnership.
“I think it would be a good program,” Commissioner Glen Davis said.