Affordable Housing

HUD announces $24.8 million ˜sweat equity" grants

WASHINGTON -- Feb. 27, 2006 -- More than 1,500 families could soon own a home as a result of $24.8 million in grants announced by the Department of Housing and Urban Development (HUD) through its Self-Help Homeownership Opportunity Program (SHOP). The money will go to four national and regional organizations.

"This funding not only helps families to purchase their first home, but taps into their own sweat equity to make them feel more invested in their new neighborhood," says Assistant Secretary Pamela Patenaude. "With a little investment and elbow grease, great things can happen and our SHOP program is proof of that."

Nonprofit organizations awarded SHOP grants include:

ACORN Housing Corporation, $572,000
Community Frameworks, $4,500,000
Housing Assistance Council, $9,000,000
Habitat for Humanity International, $10,773,000

SHOP grants are provided to national and regional nonprofit organizations that have experience in providing self-help housing. These non-profit organizations, in turn, distribute SHOP funds to several hundred local affiliates that acquire land, select homebuyers, coordinate the homebuyer and volunteer efforts for sweat equity, and assist in financings. Cash outlays cannot exceed an average investment of $15,000 per dwelling.

Homebuyers contribute a minimum of 100 hours of sweat equity on the construction of their homes and/or the homes of other homebuyers participating in the local self-help housing program. Labor contributed by volunteers also helps buyers unable to perform their sweat equity tasks due to disabilities or other reasons. Frequently, homebuyers with disabilities may substitute tasks by performing administrative assignments. The sweat equity and labor contributions by the homebuyers and volunteers significantly reduce the cost of the housing.