The first house renovated by the Salem Housing Authority’s revolving fund cost $65,000 to purchase and renovate.

 

Earlier this year The Salem Housing Authority launched a program to renovate run-down houses in order to sell or rent them to low-income residents. Now the first house is finished and about to be on the market.

The program started in March with the approval of a $500,000 revolving fund pulled from housing authority funds accumulated over time to flip houses, which essentially means that any money made from selling, leasing or renting the properties would return to the fund. The first property cost about $30,000 to purchase and approximately another $35,000 to hire Gray Construction LLC to renovate.

Renovations on the first house started back in June and were mostly cosmetic, because the foundation and frame were still in good condition. The renovations may have been mostly cosmetic, but almost the entire house had to be redone.

"We just finished the last of our renovations last week,” Salem Housing Authority Modernization Coordinator Dan Goodwin said. “We are going to get it listed with a real-estate agent soon. We're not sure what the price is going to be yet, but we want to make it affordable."

This is in line with what Goodwin calls their two main goals; to improve housing stock in the community and provide housing for people with low-income.

"Our main mission as an agency is to help people with low-income," said Goodwin. "We are having an attorney draw up a contract for a lease-to-own agreement on this first property.”

After which they will put the house on the market. Goodwin said similar contracts will likely be drawn up for future properties renovated through the program.

The housing authority has more houses in the works.

"We've already purchased the second house and are in negotiations for a third," Goodwin said. He is optimistic about their pace. "We're shooting to do four properties in the first year of the program, which is really looking doable. If things continue going smoothly, we might even do six," Goodwin said.

"Particularly these houses are going to be geared toward families with small children," he said. Goodwin described the houses as being a sort of starter home. He said of the second one, "This one we actually bought on the courthouse steps, it was a foreclosure.”

The initial February proposal states one of the clear goals of the program "that would pull the community up by its bootstraps and could, within a matter of a few years, achieve a noticeable reduction in the number of such properties within the community, and thereby make Salem more attractive to new businesses, tourists and the city’s residents," states the proposal.

The program has been designed to, by use of the revolving fund, be able to be self-sustaining.

"We may not turn a profit on every property, but the idea is that others will turn a profit," he said.

The revolving fund would then be able to be continually filled with money made from the projects in order to fund future housing projects. The goal is for the program to continue perpetually.

For information contact Dan Goodwin via email at d.goodwin@salemha.com.