To help address the housing shortage, the HomesFund is offering loans to developers that propose to build affordable homes.
The local nonprofit has about $350,000 to lend to developers to pay for architectural services, geotechnical studies, environmental assessments, appraisals and other costs for housing projects across the region, Executive Director Lisa Bloomquist Palmer said.
Developers have a harder time getting bank financing to cover pre-construction costs, she said.
“It would just be a piece of the financing puzzle,” she said.
La Plata County needs about 970 new homes each year to keep up with the growing population, according to a 2015 study by the La Plata County Regional Housing Alliance. The alliance recently changed its name to HomesFund.
But construction across the county has slowed down because of a labor shortage, Palmer said. A lack of available lots and fees are other factors builders cite for slow construction.
The U.S. Department of Housing and Urban Development has also designated the area a difficult place to build, Palmer said.
“We need to do all we can in this area to support developers of affordable housing,” she said.
The new lending program would reach people with a lower income than those who participate in HomesFund down payment assistance programs, which help residents buy homes.
Most homebuyers who work with HomesFund make between 60 and 80 percent of the area median income. Low-income housing residents would likely make between 30 to 60 percent of the area median income.
The area median income is based on household size. For a single person in La Plata County, the standard is $41,100, and for a family of four, it is $58,650.
The new lending policy opens the door to more projects, Palmer said. The HomesFund loaned money to the developers of the Lumien Apartments on East 32nd Street. There are two projects in the area that have applied for state tax credits to help fund construction, and HomesFund could help fund those projects, she said.
At least 60 percent of the units in any new housing project would have to be affordable to qualify for the loans.
Projects in La Plata, Montezuma, Archuleta and San Juan counties are eligible for funding.