Philanthropy Can Save the Starter Home for Low-Income Families | Inside Philanthropy
By Devin Culbertson
“Shared equity homeownership — in which a low- or moderate-income (LMI) buyer pays a below-market price for a home in return for accepting a modestly higher price from another LMI buyer when they sell — has been turning renters into homeowners for decades. The results are compelling: One study found that over 90% of shared equity purchasers remained homeowners after five years, while roughly half of all other low-income home buyers fell out of ownership in that time span. And the shared equity model creates lasting affordability, providing opportunities for successive generations.
The only problem is that there aren’t enough shared equity homeownership opportunities to meet demand from the millions of people trying to climb out of generational poverty, plus the growing ranks of people with solidly middle-class incomes who are shut out of conventional homeownership in thriving metro areas. To address this gap, housing-focused funders have incubated an investment approach that gives foundations, institutional impact investors, family offices and donor-advised fund (DAF) holders an easy way to fund a ramp-up of shared equity housing…”
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