Texas is booming, but for many residents affordable housing has become out of reach. In the Austin metro area, we've reached a tipping point in access to affordable homes for hard working Texans.
Increasingly, the people who care for and educate our kids, protect our communities, and make the music and art we love, are being driven out because they can’t afford to live here. For these reasons, Austin Community Foundation is working on unique solutions to close the homeownership gap in Austin.
Recently, the Foundation provided a $4 million low-interest rate loan to Austin Habitat for Humanity to help accelerate the construction of 150 single-family homes at three sites in Austin. The loan provides bridge financing to Austin Habitat with a 2% interest rate and a two-year term.
The sources of funding for the loan include a combination of grants and impact investments from Austin Community Foundation, Tito’s Handmade Vodka, St. David’s Foundation, Bill Wood Foundation, Shield-Ayres Foundation, the Aragona family and a group of donor-advised fundholders at the community foundation.
“Tito’s Handmade Vodka has called Austin home for more than 25 years,” said Amy Lukken, Chief Joyologist, Tito’s Handmade Vodka. “During that time, we’ve supported hundreds of nonprofits throughout Central Texas as they address growing needs in our communities, like affordable housing. The Austin community means so much to us, and we’re grateful to everyone who’s a part of the Austin Community Foundation funding collaborative for coming together to help build 150 affordable homes.”
The first project to be supported by the loan includes 30 Austin Habitat homes built in partnership with Austin Independent School District and Taylor Morrison, the developments are at Park at 51st and Loyola. The second project includes 120 homes to be built by Austin Habitat in Southeast Austin.
“Research shows us that health begins at home – a stable home where individuals can flourish,” said Edward Burger, president and CEO, St. David’s Foundation. “As our region continues to grow, the shortage of affordable housing has become a significant barrier to achieving optimal health. We believe there are workable solutions to address the housing crisis and this funding collaborative demonstrates how, holistically, we can advance health equity and create opportunities that promote optimal health across our community.”
“If we are going to make any dent in the affordable housing crisis in our region, we must work collaboratively across government, private and philanthropic sectors to deliver innovative and nimble solutions.”
— Mike Nellis, president and CEO, Austin Community Foundation
Households making 60-120% of the median family income in Central Texas, such as educators, healthcare workers and arts professionals earning between $58,000 and $118,000 a year, will be eligible to apply through the Austin Habitat program. These homes will be deed restricted to ensure long-term affordability and eligibility of ownership. The projects are expected to be completed in 2023. Homes will be sold for around $250,000, far below the median sale price of approximately $610,000 in Travis County, according to the July 2022 Austin Board of Realtors Market Report.
“If we are going to make any dent in the affordable housing crisis in our region, we must work collaboratively across government, private and philanthropic sectors to deliver innovative and nimble solutions,” said Mike Nellis, president and CEO, Austin Community Foundation. “This funding collaborative in support of Austin Habitat for Humanity demonstrates the critical role philanthropy can play in pooling resources and maximizing impact. We look forward to more opportunities like this in the near future.”
Austin Community Foundation highlighted the need for philanthropic investments to address the region’s affordable housing crisis by publishing a report in 2021 outlining potential strategies to produce, protect and preserve affordable housing in Central Texas. This collaborative effort of pooled capital announced today is an example of how philanthropy can help bridge the gap in funding affordable housing projects — creating pathways to homeownership for the people being driven out of their community due to skyrocketing housing costs. Read the report.