Nation Calls For New Approach To Affordable, Attainable Housing

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Builders of Hope spearheads efforts to rehabilitate vacant and foreclosed homes to reduce undesirable housing inventory, create much-needed affordable housing and construction jobs.

Builders of Hope CEO Nancy Welsh recommends recycling bank-owned homes to address the country's severe affordable housing shortage.

There is a serious misconception that affordable housing is just for people who are destitute or living below the poverty line,” added Welsh. “The reality today is that many working, middle-class Americans are struggling to put a roof over their heads.

Many Americans are currently living in a perfect storm where lower incomes, higher housing costs and the rising demand for affordable housing has them struggling to keep a roof over their heads. These factors have all contributed to the rising number of households that are housing-cost burdened. Today Nancy Welsh, affordable housing expert and CEO of the Raleigh, N.C.-based non-profit Builders of Hope, released her recommendations to rebuild the struggling housing market.

Welsh’s strategy includes rehabilitating the existing inventory of vacant and foreclosed houses to create healthy, green affordable homes. Her formula for housing success is chronicled in a new book by celebrated author, Wanda Urbanska, "Builders of Hope: A Social Entrepreneur’s Solution for Rebuilding America."

“Already there was downward pressure on affordable housing before the market collapse. The recent housing crisis has only exacerbated the situation,” stated Welsh. “From 2006 to 2010, the number of renters in the United States grew by 2.75 million households, but we’ve also permanently lost 12 percent of the country’s low-cost rentals since 1999.(1) It all adds up to millions of America’s working poor in need of safe, attainable housing.”

Adding to concerns, a Nov. 17 report from the Center for Responsible Lending found that the foreclosure crisis is less than halfway over.(2) This was preceded by reports from RealtyTrac that foreclosure filings in October climbed to their highest level in seven months.(3)

“We have a greater number of houses sitting vacant than we’ve had in decades at a time when working Americans continue to battle with the country’s enormous void of affordable housing,” explained Welsh. “Policymakers are considering tearing down as many as 3 million vacant and foreclosed homes in an effort to jump-start the housing market,(4) but that would be a critical mistake. It’s time to put our already existing stock to work by rehabilitating these houses to create affordable, attainable homes.” If the average U.S. household is 2.63 people, then 3 million homes could provide shelter for 7.89 million people.(5) That’s roughly the population of Virginia.

Extreme Green Rehabilitation
Welsh and Builders of Hope are almost single-handedly shifting the paradigm for affordable housing by providing beautiful, energy efficient housing to working and low-income families. Through the patent-pending “Extreme Green Rehabilitation” process, Builders of Hope utilizes vacant and foreclosed properties that would otherwise be teardowns to create enduring communities of rehabbed, green affordable housing.

The “Extreme Green” process essentially creates new structures out of existing framing and interiors, and allows the organization to preserve approximately 65 percent of the original structure, including valuable features such as wood flooring, solid-surface countertops, crown molding and built-ins. Rehabbed homes are outfitted with modern HVAC systems, plumbing, electrical work and siding. Builders of Hope also installs double-pane windows, new roofs and improves insulation to increase energy efficiency.

“Home recycling is an economically viable solution to many of the biggest issues created by the housing crisis,” Welsh continued. “It will not only diminish the overabundance of existing inventory and create affordable housing that the country so desperately needs, but will also create jobs for many of the construction workers who have been sidelined by the housing bust.”

The Affordable Housing Crisis
According to recent Census data, from 2000 to 2010 the nation’s median income fell by 7 percent to $49,445.(6) In addition, in the third quarter of 2011, the national median market-rate rent was reportedly $1,004, up from $981 a year earlier,(7) while the national rental vacancy rate declined to 9.8 percent, down from 10.3 percent in 2010.(8)

As a result, the Joint Center for Housing Studies (JCHS) of Harvard University found that more than a third of Americans spend more than 30 percent of their pre-tax household income on housing related expenses including rent or mortgage payments, property taxes, utilities, insurance and homeowner association fees. In addition, in 2009, 19.4 million American households spent more than half of their yearly incomes on housing.(9)

The JCHS also reported that the percentage of households earning $45,000-$60,000 a year who were housing-cost burdened almost doubled between 2001 and 2009. Facing a housing cost burden often forces households to make sacrifices when it comes to other necessities such as food, clothing, transportation and medical care.

“There is a serious misconception that affordable housing is just for people who are destitute or living below the poverty line,” added Welsh. “The reality today is that many working, middle-class Americans are struggling to put a roof over their heads due to the lack of affordable housing. Because of this, many are forced to live in at-risk communities and sub-standard housing.”

An Environmental Upside
Recycling the nation’s existing stock of vacant homes, rather than tearing it down and building new affordable housing, also offers a wealth of environmental benefits.

Welsh continued, “A study by North Carolina State University found that rehabilitating an existing home through our ‘Extreme Green’ remodeling process, defers 19.36 tons of carbon-dioxide when compared with building a new home using traditional construction methods.(10) This is equivalent to deferring the CO2 emissions from 1,979 gallons of unleaded gasoline. Tearing down a home also adds approximately 35,000 pounds of debris to our nation’s already overburdened landfills.”

The success of the Builders of Hope communities is being heralded as a universal solution to the housing crisis that is sustainable and scalable for cities across the country. To date, the organization has rescued 143 homes and 157 rental units, all while saving more than 11 million pounds of debris from the landfill.

About Builders of Hope
Since 2006, the Raleigh-based non-profit Builders of Hope has rebuilt homes and lives by providing safe, affordable housing to working families. Builders of Hope is working with officials throughout the country to forever change the face of affordable housing through its “Extreme Green Rehabilitation” approach to residential construction. The organization and its innovative model received an award from the National Housing Conference for “Pioneering Housing Strategies.” Builders of Hope has major development projects underway in Raleigh, Fuquay-Varina and Charlotte, N.C. It recently established affiliates in New Orleans, La. and Dallas, Texas with a model that can be easily expanded to states throughout the nation.

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(1) Joint Center for Housing Studies of Harvard University. (2011). The State of the Nation’s Housing 2011.

(2) Center for Responsible Lending. (Nov. 17, 2011). Lost Ground, 2011.

(3) RealtyTrac. (Nov. 9, 2011). U.S. Foreclosure Activity Hits 7-Month High in October.

(4) Gandel, Stephen. Time. (Sept. 5, 2011). How to Save the Housing Market: Destroy Houses.

(5) U. S. Census Bureau. American FactFinder. (2010). Average Household Size of Occupied Housing Units by Tenure.

(6) U.S. Census Bureau. (2011). Median Household Income by State - Single-Year Estimates.

(7) Wotapka, Dawn. Dow Jones Newswire. (Nov. 2, 2011) U.S. Homeownership Rate Climbed In Third Quarter.

(8) U.S. Census Bureau. (Nov. 2, 2011). Residential Vacancies and Homeownership in the Third Quarter of 2011.

(9) Ibid, 1.

(10) Pires, Steven; Strayhorn, Tyler; Blank, Dr. Gary B. North Carolina State University: College of Natural Resources. (Feb. 16, 2011). Life Cycle Assessment of a Site Specific Residential Home.

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