title
Southwest MN Housing Partnership - Reisch Addition Twinhome Project
body
The Southwest Minnesota Housing Partnership (SWHP) will be awarded $1,187,580 Impact Fund Dollars from the MN Housing Board of Directors for their 2024 Single Family Housing application. The funds will be used to construct twin homes in Luverne.
Proposed Project:
SMHP will construct three twin homes (6 units) on three lots in the Reisch Addition. The units will be three-bedroom, two-bathroom, two-car garage, single-level twin homes with one shared wall.
SMHP applied for state Impact Funds to bridge the VALUE GAP and AFFORDABILITY GAP. The Value Gap addresses the difference in the cost it takes to build a project, and the dollar amount at which it can be appraised and sold. The Affordability Gap addresses the gap between what a property is selling for and what the buyer can afford. Value Gap will be used for the six units for households at or below 100% AMI (household income limit of $111,700). Any Affordability Gap provided will be limited to households at or below 80% AMI ($89,400).
Total Project Costs = $2,659,500
# Of Units = 6
Total Development Cost Per Unit = $443,250
Impact Fund Award Total = $1,187,580
Grant Award Per Unit = $197,930
Example of possible funding scenarios (each unit will be unique based on buyer):
Impact Fund Value Gap Subsidy Per Unit = $145,850
Impact Fund Affordability Gap Subsidy Per Unit = $51,080
Administration Fee Per Unit = $1000
Typical Grant Per Unit = $197,930
Typical Development Cost Per Unit =$443,250
Typical Grant Award Per Unit = $197,930
Average Price to Buyer = $245,320
The Housing Partnership is the grant recipient and will be leading the project. Their tentative timeline includes:
Design & Bid - Spring/Summer 2025
Construction Start- Fall/Winter 2025
Construction Finish- Summer 2026
The Housing partnership is responsible for the construction and sale of all homes. More details will be available as their project plan develops.