What to know about a shared equity program in Pueblo that's the first of its kind in the US
A 24-year-old Pueblo man is realizing a dream as the first among his friends to become a homeowner thanks to a shared equity program overseen by NeighborWorks Southern Colorado that's the first of its kind in the nation.
"It's incredibly nice to have my own place," said Pete Lopez, a South High School graduate. "It is a three-bedroom home with an unfinished basement and so it seems huge to me."
"I feel so grateful to be living in a really beautiful, brand new home."
Lopez, like many Puebloans his age, did not think the idea of homeownership was attainable for him.
"It wasn't an option considering the market with the housing prices rising, and even renting is difficult to afford," he explained. "I didn't think I could attain something like this for five to 10 years."
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The home, located in the 2300 block of West 19th Street, will serve as the model for homes sold in the new Pikes Peak Park development, where a total of 600 housing units will be constructed for low- and middle-income residents. The Pikes Peak Park development encompasses 74 acres in west Pueblo, located north of 24th Street, west of Wildhorse Creek and east of Pueblo Boulevard.
The first phase of the subdivision encompasses 114 single-family lots. Later phases will include townhomes and apartments, and there's plans for facilities like child care, health care, a small grocery store, farmers markets, restaurants and open space trails within the walkable neighborhood.
The subdivision will be the first in the nation using a shared equity model, thanks to approval from the Federal Housing Finance Agency and mortgage lenders Fannie Mae and Freddie Mac.
For Lopez, not only is it his first home, but his first time moving out of the family home where he has lived with six other people. Luckily, his sister lives next door in a home she was able to obtain with the help of a different NeighborWorks program and his father pops in to check on him frequently.
"I am trying my best to make the home cozy. It's really crazy to think I am the first in the nation to do this and it's really special to be the first," he said.
Lopez has worked the past three years as a homeownership counselor with NeighborWorks, so he said "letting other people know this is actually possible" is something that will make his job even more meaningful.
What is shared equity?
In Lopez's case, the equity in his $325,000 home is shared between him and NeighborWorks. His mortgage covers $125,000 of the cost.
Lopez also was able to take advantage of two other NeighborWorks programs, including down payment assistance and 'sweat equity,' which allows the homeowner to perform 50 to 100 hours of labor on the home build for an additional $15,000 in equity credit.
The programs contribute to making homes affordable by reducing the purchase price of the home, reducing the overall monthly payment, or lowering the amount that the owners need to qualify for a home loan, according to Tamara Pleshek, real estate manager for NeighborWorks.
Because Lopez's home is deed restricted it safeguards the long-term value of the initial investment in affordable homeownership by limiting any subsequent sales of the home to income-eligible borrowers at an affordable price.
“The growing affordability gap makes it essential to combine multiple subsidies to create opportunities for wealth building for families traditionally locked out of homeownership. This is the first step toward creating a model that can be replicated on a larger scale, making homeownership attainable for all," said Ashleigh Winans, NeighborWorks Southern Colorado chief executive officer.
"This model of shared equity is not only beneficial to the organization by way of expanding the portfolio, but also to homebuyers as they look for safe, affordable homeownership opportunities and create a wealth-building mechanism that is not possible through renting," Pleshek said.
"Even rental prices are so high right now it's insane and it's disheartening. Maybe in the future, NeibghborWorks can help with rent programs too," Lopez said.
For more information on NeighborWorks Southern Colorado, go to nwsoco.org.
Chieftain reporter Tracy Harmon covers business news. She can be reached by email at tharmon@chieftain.com or via X, formerly Twitter, at twitter.com/tracywumps. Support local news, subscribe to The Pueblo Chieftain at subscribe.chieftain.com.
This article originally appeared on The Pueblo Chieftain: Pueblo shared equity program breaks down barriers to home ownership
