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Affordable Homeownership in and around Rochester, MN, for 20+ Years
Homeownership is a quintessential part of the American dream, but due to rising housing costs, it is out of reach for many. That’s why for over 20 years, First Homes has been working to make the dream of affordable homeownership possible for buyers in and around Rochester, MN.
In spring of 2024, Rochester Community and Technical College (RCTC) carpentry student, Ashleigh Huxsahl, worked to attach siding to new home in Southeast Rochester. She and other carpentry students move about the construction site, working on different projects. The new construction was unusual in a well-established neighborhood, but the modest home would fit in perfectly with its neighbors.
Carpentry student, Ashleigh Huxsahl, adds siding to new-construction house.
RCTC had partnered with local nonprofits in the past to build homes and give students valuable experience, but this was the first time that RCTC was partnering with First Homes.
“The timing worked out perfectly,” explained First Homes’ Director of Projects, Justin Voss.
First Homes was preparing to build a new home in southeast Rochester when the new semester was getting underway. RCTC, who had partnered with Habitat for Humanity in the past, had no upcoming projects for their students.
Thus a partnership was formed.
RCTC Instructor, Aaron Davis, supervises and guides students as they transition from the classroom to the worksite.
“Learning encompasses everything from site layouts and framing to siding and everything that goes into building residential housing,” explained Davis.
As part of RCTC’s carpentry program, students had the opportunity to gain valuable real-life experience. Getting experience in the field is invaluable to the students who are working to establishing careers of their own.
RCTC Instructor Aaron Davis
Huxsahl, a Navy veteran, joined the RCTC carpentry program to gain the skills necessary to start her own business.
“I’m going to work in residential,” she explained, “then start my own company building modular houses.”
In addition to learning, students were excited to give back to their community.
This opportunity particularly appealed to Huxsahl who wants to establish her own business to help seniors right-size into more accessible homes. “This is an introduction to see what it’s all about and to get into building affordable houses,” Huxsahl explained. “I’m very excited to work with First Homes. It’s a win for First Homes, RCTC, and future buyers.”
The partnership between RCTC and First Homes was the first of its kind and served as a proof-of-concept, to see if future partnerships would be beneficial. The home that Huxsahl worked on was completed on time and sold to an income-qualified buyer.
Now, RCTC is getting ready to partner with First Homes on its third home.
“It has been a wonderful, mutually beneficial opportunity,” said First Homes Program Associate Emily Neville. “Our tagline is ‘benefiting families and communities,’ and this is just another way we can do both.”
When their project in Southeast Rochester was completed, students and their families were invited to a showcase to see the finished product. Huxsahl attended with family members, explaining the work that she and other students did.
“Building a house is a pretty unique school project,” commented Neville. “Everyone was so proud of their work.”
The completed home before sod installation.
The home was sold to an income-qualified buyer and has led to two more similar projects between First Homes and RCTC. Both organizations are excited to continue this cooperative relationship that supports local residents, students, and future professionals.
Is Your Client Considering Purchasing a CLT Home? What You Should Know as an Agent
As a real estate agent, you want what is best for your client. This means getting to know their wants, needs, and budget so you can present them to options that will work best. That’s what the Community Land Trust (CLT) offers- an option. Purchasing a CLT home through First Homes isn’t the right choice for everyone, but by understanding what a CLT is, how it works, and the qualifications, you can help your client understand all of their options so they can make the choice that is right for them.
What is a Community Land Trust?
A Community Land Trust (CLT) is a well-established model built around shared equity to create and preserve affordable homeownership. This allows for a cycle of affordability, meaning one home can stay affordable in perpetuity.
How Does Shared Equity Work?
First Homes subsidizes a CLT home to sell it to an income-qualified buyer at a more affordable price. When the owner sells the CLT home, the appraised equity is shared 50/50 with half going to the seller and the other half staying within the home. This continued investment re-subsidizes the home and keeps it affordable for the next buyer, creating a cycle of affordability.
How do I Know if My Client is Income Qualified?
First Homes operates at 80% Area Median Income (AMI.) To be an income-qualified buyer, your client must make at or below 80% AMI. This changes annually. Click here to view the current income limits.
What Types of Houses Does First Homes Buy and Sell?
First Homes purchases homes on the open market to add to the CLT. We buy a variety of homes including single-family detached and town homes, and have the resources to renovate them when necessary. We also build new construction homes using high-quality builders. View our available homes here!
Does a CLT Buyer Own Their Home?
Yes! When your client purchases a CLT home, they own it, build equity, and are responsible for maintenance, taxes, and other traditional homeowner duties.
Does the Director of Community Land Trust Earn Commission?
No. The Director of Community Land Trust does not earn commission for CLT home sales; instead they are a salaried employee of First Homes. Any commission earned goes to the First Homes organization to support its operations.
Do I Still Earn Commission as my Client’s Agent?
Yes. When you represent your client purchasing a CLT home, you still earn commission based on their purchase.
Is Purchasing a CLT Home Right for my Client?
First Homes is not right for everyone. However, if your client is struggling to afford a market-rate home and is income-qualified, First Homes can be a path to homeownership. If you have more questions about First Homes or the CLT, contact us at 507-287-7117!
Join us in celebrating community member and CLT homeowner, Zenebech Aly, who received the 2024 Heart of Community Honor award after being nominated by fellow community members.
Formerly the Unsung Hero Award, the Heart of Community Honor award presented by the McKnight Foundation honors “everyday champions” across Minnesota “whose compassion and contributions serve as the heartbeat” of their communities.
On recipient was chosen from each of seven regions of Minnesota, with Aly representing the Southeast region.
Nominated by members of the community, Aly was touched by their recognition and humbled to win the award.
Creating Community During COVID-19
After emigrating from Ethiopia, Aly struggled to find the same sense of community she had back home.
“In Ethiopia, your neighbors check on you; it’s a very connected community. If you have a problem, you call your neighbor, not 911,” Aly explained. “It’s not like that in the United States.”
Working with people of different backgrounds, religions, and countries of origin showed Aly that her search for community wasn’t unique. Feeling isolated and displaced was a shared sentiment.
“We needed to create community in the United States; community outside of religion or place of origin,” Aly recalled.
Enter in the Ethiopian Community of Rochester (ECRM)– a community dedicated to fostering a vibrant and supportive environment for the Ethiopian community through preserving and promoting Ethiopian culture, providing resources for community members, and empowering individuals through education, social engagement, and economic development.
As a dedicated volunteer and member of the leadership team for ECRM, Aly has worked to help people find employment, housing, support, translate materials, and navigate an unfamiliar space.
The COVID19 pandemic only exacerbated existing challenges.
According to a study by Boston University, “the pandemic has had a disproportionate impact across different socio-economic groups in the U.S.” across health, employment, education, and more.
“COVID taught us a lot,” said Aly who witnessed these struggles first-hand in Rochester, MN.
It started with phone calls.
“We started calling people, asking how they were doing and if they needed something.”
Aly began coordinating grocery deliveries, supply drops, helping people complete the census, and offering an attentive ear to those who were feeling isolated.
Transportation and language also proved to be barriers for community members. To combat this, Aly worked to translate and explain information from the Centers for Disease Control and Prevention (CDC) so members of the community could make informed decisions.
These barriers extended beyond the pandemic, impacting people’s ability to navigate available services, information, and voting. Many of those Aly worked with were intimidated by government officials due to experiences they had in their countries of origin. Participating in the electoral process was overwhelming.
Empowering the Next Generation
Aly’s efforts have continued to grow and evolve to meet the community’s needs. The latest endeavor is a youth group. Made up of middle and high school students, the youth group focuses on nurturing leadership potential, teaching students to advocate for themselves, how to turn their ambitions into reality, and growing their intrapersonal skills.
Zenebech Aly, Award Recipient
Sharing their cultural heritage has been integral to the youth group’s activities.
“We have our own alphabet, our own way of counting time,” explained Aly, adding that over 80 languages are spoken in Ethiopia alone.
Students have been excited to explore their cultural heritage and share it with their peers, organizing a fashion show and other cultural exhibitions.
First Homes has been serving the greater Rochester, MN area since 2000, dedicated to creating and preserving affordable homeownership opportunities. Using the CLT housing model makes this possible.
First Homes acquires or builds a house. First Homes subsidizes the house and sells it at a lower cost to an income-qualified buyer. When the owner sells the home, the increase in appraised value is shared between the seller and the home itself. This builds on First Homes’ original subsidy, allowing the home to be sold to another income-qualified buyer at a more affordable price. This cycle of affordability means that the 300+ homes in First Homes’ program have the potential to be affordable forever.
Homeownership has been incredibly influential for Aly.
“For me, homeownership is more than just having a place to live; it’s about creating a space where my family can grow, create memory, connect to the neighborhood, and continue contributing to the community,” Aly explained.
Owning a home has only reinforced Aly’s commitment to the community. “It has given me a deeper understanding of the housing challenges many families face and has motivated me to be more involved in initiatives that support affordable housing and homeownership opportunities,” explained Aly. “It also provides a stable environment that allows me to focus on my work and values I am passionate about.”
Her experiences have also allowed her to better educate others on the homebuying process.
Aly provides education to buyers on how to access downpayment assistance, financial literacy, and the importance of a credit score, and more “so people can make the best decision for themselves,” she explained.
Quantifying the Impact
Aly’s work shows just how important communication is as a workforce skill.
When asked what winning the Heart of Community Award, meant to her, Aly replied, “It means so much to me.” She is honored by the time and effort that her colleagues put into nominating her and thrilled to be recognized by them and Minnesota.
Aly’s work is far from complete. “There’s an information gap in our community,” she said. Using her experience and skills, Aly continues to work to connect people with the resources they need, saying, “ask your question and I will be here.”
It is impossible to quantify the impact that Aly’s work has had on the community. It lives and grows in each person whom she interacts with- even those who just needed a listening ear.
Community Land Trust (CLT) homes cost less than market rate homes because the CLT homebuyer purchases only the house and enters into an agreement with the CLT for the use of the land, this agreement is a Ground Lease. Learn More…
This List of Lenders are knowledgeable professionals that have worked with First Homes for many years. They are familiar with the Community Land Trust program and can assist you with getting approved for a bank loan.
