Duke administrators are trying to make Durham a little more like home for some employees.
The University has proposed a partnership with the city of Durham to reduce the cost of housing in Durham’s Southside neighborhood for University and University Health System employees, said Phail Wynn, vice president for Durham and regional affairs. Duke’s new initiative would allow employees to purchase new homes at subsidized costs with no down payment.
“Duke is… the largest employer in the community, and establishing an initial critical mass of home-buyers in this challenged neighborhood will contribute to success and hopefully attract additional home buyers,” City Manager Tom Bonfield wrote in an email Tuesday. “By identifying qualified employees and providing assistance for credit counseling and credit repair, Duke would be an invaluable resource.”
Some details of the project have yet to be determined, and the University has not formally announced the initiative, Wynn said, though he has discussed it with city leaders.
“The project that we’re looking at is where the city has placed a priority in some of its inner-city neighborhoods and also some of the neighborhoods that have been impoverished for a long time,” Durham Mayor Bill Bell said. “For the University to… support the housing efforts is very important, even key to revitalization.”
The project would collaborate with Durham’s current efforts to redevelop the neighborhood and would initially include 10 University employees and their families, Wynn said. After these participants are identified and have qualified for mortgage loans, Duke officials plan to work with the city and developers to construct homes for the participants.
Eligibility criteria for individuals interested in the program include five years of continuous employment at the University and a maximum of $40,000 in income from Duke, Wynn said. All qualifying employees will be eligible to apply for the program, though only 10 will be chosen for the pilot phase, with another 25 or so being placed on a waiting list.
“The benefits and incentives of the program include no down payment on the home, [which will be] provided through a $10,000 loan that will be forgiven after five years of continuous occupancy in the home, a below market-rate mortgage loan and the purchase of a new home at two-thirds of the purchase price,” Wynn wrote in an email Monday.
Participants will also be required to enroll in the Center for Community Self-Help’s Fast Track program, a community development program that works with aspiring homeowners and provides them assistance in credit repair, credit building and saving, Wynn added.
Wynn did not comment on the cost of the program or how the University will finance the program.
Bell noted the advantages to Duke’s proposal not only related to housing but also having to do with the city’s ongoing efforts to be environmentally conscious.
“[To make] sure we have a [low] carbon footprint that’s sustainable, we’re looking at transportation issues for Duke employees who become homeowners in that area, where they can make the best use of public transportation,” Bell said. “Southside is an accessible area for public transportation to help employees get back and forth between home and job.”
The city of Durham has been working with Self-Help on redevelopment projects in the neighborhood for the past four to five years, Bonfield said. Self-Help plans to sell the 100 Southside properties it has acquired to the city or other nonprofit home builders interested in participating in an overall city rehabilitation strategy.
“The Southside Neighborhood is one of the… more challenging inner-city neighborhoods with low homeownership, high vacancy rates [and] high code enforcement needs,” Bonfield said. “[The] neighborhood has been in decline since the Durham Freeway was constructed 40 years ago.”
The city has not yet constructed any new homes—though it has completed rehabilitation on two homes and plans to renovate two others soon—but hopes to construct at least 35 homes in the first phase of the project, Bonfield added. Each home will cost the city about $165,000, and qualified buyers will be able to purchase them with a reduction of about $35,000 to $55,000, plus any Duke-funded subsidy. Officials hope this initial phase will create momentum for more market-based new construction in the future.
Although the proposed initiative would be novel, it would not mark Duke’s first involvement with the Durham’s Southside rehabilitation project, Bonfield said, noting that Duke has provided Self-Help Credit Union with low-to-no interest loans to acquire the properties for a number of years.
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