Income Requirements And Sweat Equity: What It Takes To Qualify For A Habitat Home
Habitat for Humanity, the nonprofit that builds homes for people on the financial edge, just signed a deal to buy nearly four dozen lots in the rapidly gentrifying neighborhood of West Dallas. Getting people into the homes that will be built there, though, will take years.
That's the part of town that was the focus of a KERA series this spring called One Crisis Away: No Place To Go. Many of the rental properties there are no longer up to city code, including several hundred houses owned by HMK Ltd.
Last week, HMK announced that it has sold 46 of its now-vacant lots to Habitat. While the landlord's current tenants can apply, getting approved for a Habitat home isn't guaranteed.
From 305 to 50
Ten months ago, 305 low-cost rental homes, owned by HMK Ltd, were deemed "substandard" by the city of Dallas. Since then, about half the tenants have moved out. Co-owner Khraish Khraish says he's sold another 100 or so homes to the renters themselves-- leaving about 50 families who have until Oct. 2 to make a plan. That's when a judge's order protecting the houses from code violations expires.
Now, Khraish is selling empty lots where some of those homes once stood to Dallas Area Habitat For Humanity.
"They don't flip the land, they build an affordable product on the lots. That's why I had the trust in working with them," he says.
High-end apartments and townhomes are popping up in several spots across West Dallas. Khraish says there's nothing in the works for low-income families who have lived there for generations.
"We are trying to stabilize the community and stabilize the neighborhood, and there aren't any affordable housing builders in Dallas at any scale," he says.
Which is where Habitat comes in. The nonprofit will build brand-new, code-compliant homes on these lots. And while HMK tenants can apply to own one, they may or may not qualify.
"The myth is Habitat provides or gives away homes," says Bill Hall, CEO of Dallas Area Habitat For Humanity. "In reality, every family has a loan, just like you or I do, so they have to be able to afford that loan. And they have to be under a certain amount of income also."
He says a family of four that brings home between $25,000 and $30,000 a year will likely qualify for a home. That income level means they can usually afford to spend $600 to $900 a month on mortgage, insurance and taxes. Many HMK tenants don't fit that mold.
"So strangely enough, a lot of the HMK families made too much money for Habitat, and quite a few made too little," Hall says.
Another reason a lot of HMK families can't count on one of these new Habitat homes in West Dallas right away is that it will take two to five years to build all of them.
"Well the other challenge is everyone thinks 46 lots are right next to each other, they're not, they're spread out all over the place. So what we do is we tend to wait until we get enough lots on a block to make a difference. And then we build," says Hall.
New Habitat homeowner Jesus Cruz remembers that process well. He was actually turned down the first time he applied. After working out some issues on his credit report, he tried again, and was successful. That's when the real work started. He took 30 hours of required classes about being a homeowner, and put in 170 hours of what Habitat calls "sweat equity." Basically, he helped put his house together.
"To build my house it was real fun first of all, because I've never seen a house building from the ground. So I was so interested. When they put the walls, I think it was like a dream to me, I could not believe it," he says.
A new way to live
Cruz, his wife and their four children had been crammed into a room they rented from a family member. There was no privacy or space for the kids to play. Moving into a three bedroom house with a yard-- was surreal.
"When I opened the door and stepping in and started moving my clothes and everything, it was like a dream come true. I was like, 'thank you God,'" he says.
Cruz's new house is in Los Altos, a West Dallas neighborhood. The 46 lots Habitat just bought are there too.
Some of the families still renting from HMK Ltd may very well live in those future Habitat homes one day. Still, 10 weeks from now, they'll have to leave.