Govt. housing loans call for do-it-yourself building

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A local agency is bringing together contractors and community members to build new homes for low-income families in the region.

No, ABC is not filming an episode of Extreme Home Makeover in Colorado. Rather, it’s another unique loan program from the US Department of Agriculture that offers home ownership to the working poor while building strong ties within the community.

Last week I wrote about a little-known federal loan program from the USDA that helped buoy the Woodland Park housing market through the downturn. The rural development loan program allocates roughly $150 million a year in direct loans and guarantees to low- and moderate-income families in Colorado, with the requirement that the homebuyer build or purchase in rural areas of the state (that means pretty much anywhere except Boulder, Denver, Colorado Springs or Pueblo).

An offshoot of that program is run locally by the Upper Arkansas Area Council of Governments. The Mutual Self-Help Housing Program is similar to the rural development program in that it provides direct loans to low-income families in rural areas. The difference here is that loan recipients are responsible for physically building their own homes and the homes of their neighbors.

“(The UAACOG) teaches you everything you need to know. We have a construction supervisor who shows you how to handle all the technical aspects of the construction and takes care of the inspections after the house is built,” said Ashley Rall, who works for the UAACOG and lives in a home she built through the program in 2009.

“Other than that, you’re literally building your own home,” she said. “I did the roofing and insulation, trimmed the doors, installed the cabinets and painted. And it’s better built than most – my heating bills have never been over $65 a month.”

The UAACOG purchases a plot of land, in Rall’s case the Juliana Court subdivision in Canon City, and then rounds-up a qualified group of families interested in building there.

“There were four families in my group,” Rall said. “You take turns working on each stage of someone’s house, so you’re finishing them all at the same time. My neighbor and I teamed up to work on the roofs of all the houses. Each household has to put in 30 hours of work a week, but 15 hours can come from volunteers. My dad was out there pitching in.”

Rall said the four houses in her group were completed in just over five months, but the investment in time pays off in dollars. While contractors are needed to put together the foundation and framing, the money saved in construction costs on the rest of the home is realized immediately.

UAACOG Housing Director Sharon McKinsey said homes typically appraise for $25,000 to $35,000 above the value of the loan, and Rall confirmed this was the case with her home.

“I got a loan for $130,000, but we came in under budget so I only owed $125,000,” she said. “The house appraised for $160,000, so I came in with $35,000 in equity.”

The UAACOG has coordinated the construction of 92 homes in Colorado since the program’s inception in 2000. There are now seven homes in Ralls’ subdivision in Canon City, another three parties have closed on land there, and the UAACOG is waiting on funding to come through for another five families that have qualified.

Of course, it’s not a great time to be dependent on federal dollars.

“There’s always a chance that the funding won’t come through,” McKinsey said. “Everything is on the chopping block right now.”

Assuming funding doesn’t dry-up, Woodland Park is again eligible for development through the program by virtue of its fewer than 10,000 citizens. Still, McKinsey said there is nothing currently in the works for the growing mountain town.

“The cost of property is considerably more (in Woodland Park), so we haven’t ventured out there yet,” she said.

And just like you might have been surprised by Woodland Park’s rural designation, you might be wondering how Canon City is eligible – according to the 2010 Census, the city has a population of 16,400.

“The USDA doesn’t count inmates,” McKinsey explained.


I’m sad to announce that this is my final column for the Colorado Springs Business Journal. I’ve accepted an opportunity in New York City and will be moving there next week.

I was only here for a short time, but the city quickly became my home. Thanks to everyone for taking me in and making me feel welcome. Please keep in touch.

Please send story ideas and any correspondence to Managing Editor Rob Larimer at until a replacement real estate reporter is in place.