Demand, building costs increase during COVID-19 pandemic
By Natalie Johnson
In response to an ongoing need for affordable housing in the Methow Valley, the Methow Housing Trust (MHT) recently announced that it would expand its eligibility for home ownership through the program, now allowing families at 150% of the county’s area median income to apply.
MHT previously capped applicants at 100% of the county’s area median income (AMI). In the past two years, the organization’s leadership learned that it needed more than a “one-size-fits-all” approach to the issue, said Executive Director Danica Ready.
“At some point we were turning away community members who really had no options,” she said. “Two years ago, when we started processing applications for eligibility, we could still look on the Multiple Listing Service and see there were houses available for $200,000, $250,000.”
But that’s not the case anymore, she said.
MHT will now offer two options. For a family making 100% of the AMI, the home price and mortgage will be calculated to fit their “wage reality,” according to the housing trust.
Families making 150% of the AMI are newly eligible to apply, and their home sale price will be closer to the market rate, but still subsidized by MHT. The trust will sell up to 25% of its homes to families in the higher wage bracket.
“The eligibility policy is the backbone of our mission,” said Rocklynn Culp, policy committee chair for MHT, in a statement. “We wrestled with multiple eligibility options for well over a year before landing on the decision that felt right.”
As of April 1, the area median income for a two-person household in Okanogan County – which is calculated by the U.S. Department of Housing and Urban Development – was $56,500.
By next year, the housing trust plans to have finished 30 homes in the Methow Valley. Their 10-year goal is to have 70 homes completed. Including lots in Winthrop’s Cascade Condominiums neighborhood that the trust owns, it has all the land it needs to complete that goal, Ready said.
Low demand wasn’t the reason for increasing eligibility for the housing program, Ready said. It was actually the opposite.
Real estate market prices have increased by 56% in the past five years, and in 2020, the median sale price of a home in the Methow wass $450,000, according to MHT. The cost of housing is only going up, and at the beginning of 2021, only a handful of houses were on the market in the valley, with many of them priced well past the means of the average resident.
Building materials also drastically increased in cost during the pandemic.
“You just can’t get around material costs,” Ready said. “We were building homes for $200 to $220 a square foot last year. That’s with every efficiency we can find. I don’t know what our per-square-foot cost is going to be this year.”
The MHT has completed 13 homes in the Canyon Street neighborhood in Twisp, and eight homes in the McKinney Ridge neighborhood near Mazama.