Self Help Housing

Self-help, or sweat equity housing enables potential homeowners to build up credit for a down payment on a home by contributing their labor to the construction or renovation. It can be a means for the low-income household to enter the housing market. Community-help housing expands the labor pool to include the neighborhood or a broader group of volunteers, such as houses built by Habitat for Humanity. Programs can be utilized by individuals or groups, usually with subsidies and public support. California Housing Finance Agency (CHFA) finances self-help housing by providing below-market bond financing for mortgages on homes in urban areas and the Farmers Home Administration Mutual Self-Help Housing program has sponsored many rural development projects.

Benefits

• Allows individuals and families to obtain a home for which they could not otherwise qualify.
• Saves money both for participants and funding sources because of the labor provided.
• Helps develop valuable skills for the participants through the on-site home building or renovating experience.
• In programs that involve rehabilitation of neglected homes, improves the housing stock and returns properties to the tax rolls.
• Can result in higher quality housing, because owners are responsible for completing detail work.

During the Housing Element Process...

• Involve Community Groups. Community non-profit organizations tend to organize most self-help development projects. Local governments can contact non-profits to provide information on the existing local opportunities and/or assist interested players.
• Review Existing Ordinances and Regulations. Consider whether there are any existing ordinances or regulatory mechanisms that encourage self-help housing developments.