New homes and rental properties could hit the Oklahoma market in the next two years if rules for a $215 million state-funded construction loan program are approved by the end of the year, officials said.
The Oklahoma Housing Finance Agency, which will oversee the state’s new Housing Stability Program, is crafting rules to administer it. During a virtual meeting Wednesday, the agency sought suggestions as it works to finalize the program’s rules. The agency serves low-income residents with vouchers for rental assistance, and downpayment and closing costs.
The agency fielded dozens of questions this week, mostly from housing developers but also from hopeful homeowners, who planned to benefit.
The Housing Stability Program is designed to boost affordable housing supply as new home construction costs and rent prices rise. Over 26,000 residents are waiting for rental assistance, and the housing stability program is expected to serve up to 900 families.
Officials plan to offer up to $63.5 million for rental property construction and $100 million for new home construction. At least $40 million has been set aside to help homebuyers with down payment and closing costs.
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Corey Bornemann, spokesperson for the agency, said he’s pleased that so many people have weighed in since public meetings began in August.
“It’s been really helpful to really curate a program that we think will be really successful once we get it rolled out,” he said.
If Gov. Kevin Stitt approves emergency rules, the program will kick off early next year, agency officials said.
Bornemann said the agency has implemented suggestions after speaking with residents from rural and urban communities for the last few months.
Based on public feedback, the agency reduced the size of homes from the minimum of 1,300 square feet to 1,000 and from a maximum of 2,200 square feet to 2,000.
“A lot of feedback we got, especially in rural Oklahoma, is that family sizes are just decreasing,” Bornemann said. “Homes don’t need to be as large as they used to be.”
Another suggestion the agency implemented is to accept manufactured houses in the program, which are often less expensive and allowed in rural areas.
According to the rules, experienced housing developers can apply for zero interest loans to build rental properties and new homes, but the loans must be repaid within two years or face interest charges.
Prospective homeowners who make less than $150,000 a year can apply for downpayment and closing cost assistance. Homeowners are not required to repay the funds if they remain in the home for three years.
Rent prices also will be capped at 125% of the area rent market to ensure affordability for three years, Bornemann said.
Public comment is available on the agency’s website through Dec. 5.
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