Saving Affordable Housing: USDA and Local Heroes Combat Mortgage Crisis

Imagine calling a place home for eight years, creating memories with your beloved corgi Arlo in a cozy Orono apartment. Lisa Tissari knows this feeling all too well. Though her space may be snug, it’s bursting with warmth and community spirit. With holiday celebrations in the community room and a genuine bond with her neighbors, it’s more than just an apartment—it’s a family.

“You know how it goes,” Lisa chuckles. “At some point, we’ve all found ourselves accidentally locked out of our own homes. But that’s where I come in! Just buzz me, and I’m there to save the day. I’ll even call maintenance if needed! Looking out for my neighbors, especially the older ones, is just part of who I am.”

But when whispers of a potential sale of their cherished building floated through the air, anxiety took hold. “Where would I even go?” Lisa fretted. “Affordable housing is like searching for a needle in a haystack these days, and don’t even get me started on first, last, and security deposits!”

Relief washed over her when she learned that the Housing Authority of the City of Old Town would be stepping in to purchase the building. They’ve been managing this property all along, ensuring stability for residents like Lisa.

This isn’t just about one building; it’s part of a larger mission. In Maine, over 7,000 affordable housing units thrive under the USDA’s Section 515 program, a lifeline established during the Truman administration back in 1949. This program offers reduced mortgage rates to landlords while providing rental subsidies for tenants, making living costs manageable for many struggling families.

“This program is crucial,” explains Rhiannon Hampson, Maine’s USDA Rural Development director. “It allows families to keep their loved ones—be it elderly parents or disabled siblings—close to home.”

However, there’s a looming challenge: as many properties under this program finally pay off their mortgages, the rental subsidies are set to disappear. “We’re working hard to transition these properties to housing authorities and nonprofits, ensuring these vital affordable units remain part of our communities,” Hampson adds.

In the next three years alone, 15 mortgages will be paid off in Maine, impacting 375 affordable housing units—a potential crisis for many. But there’s a silver lining! Many property owners are choosing to prioritize tenants over profits. Instead of raising rents or selling to developers, they want to continue providing safe, affordable housing.

“Some owners are saying, ‘I’ve been part of this community for generations and want to keep it that way, but I’m ready to hand over the reins,’” she shared.

To assist these landlords, the USDA collaborates with organizations like the Genesis Community Loan Fund. Liza Fleming-Ives, the executive director, explained how Genesis connects property owners with housing authorities or nonprofit buyers. Over the past five years, they’ve successfully preserved 142 affordable units across five Maine properties. “Our goal is to ensure these homes remain affordable for generations to come,” she stated.

That’s exactly what happened in Old Town. The local housing authority swooped in and secured the building where Lisa resides. Laurie Miller, the executive director of the housing authority, explained that this was their third successful acquisition in the area.

“By securing a new USDA mortgage, rental assistance for current tenants is guaranteed to remain intact,” Miller emphasized. “The tenants won’t notice a thing; their rental assistance is safe for the next 40 years!”

For residents like Lisa, this news is a breath of fresh air. “We all let out a collective sigh of relief,” she said. “We can stay in our homes, in a safe environment, and not be forced out by rising costs. It’s a huge comfort!”

Nationwide, there are over 360,000 units financed with Section 515 mortgages through the USDA, providing crucial support in a time of need. With limited federal funding, the focus is now on preserving these existing properties rather than building new ones. It’s all about keeping communities intact and families thriving.