Employees looking to live a little closer to where they work and employers looking to help their employees find a nearby place to call home have a new tool to turn to in Longmont.
Start to Home, launched less than a month ago by the Longmont Economic Development Partnership and Cornerstone Home Lending Inc., draws on a network of national and local partners to help ease the way to home ownership.
The program offers a number of incentives to those seeking to move to Longmont, as well as those seeking to stay in Longmont. Among them is a $2,000 credit which can be applied toward closing costs, prepaid escrow fees and possible interest rate buy-downs for both purchase and refinance transactions. Mortgage insurance discounts and lending variances may also be available for those relocating to the area. It also connects would-be homeowners with real estate agents and gives them access to up-to-date Multiple Listing Service information via the HomeScout search engine.
To participate in the program, employers must be members of the Longmont Economic Development Partnership.
The Longmont Economic Development Partnership spends a lot of time talking to local businesses, and about three years ago started hearing one of the major concerns of employers was the cost of homeownership in Longmont and Boulder County, said Jessica Erickson, president and CEO of LEDP.
Housing is key to employers’ ability to attract a qualified workforce, as well to retaining employees, Erickson said. It also plays a role in Longmont continuing to attract new businesses and continuing to broaden its employment base.
Pre-coronavirus pandemic, the local unemployment rate was about 2.5% and the program was originally aimed at being a tool employers could use to help lure a qualified workforce, Erickson said.
“It was primarily intended to be a talent-attraction program. Now it’s both a retention and attraction program,” she said pointing to Start to Home’s support for those seeking to refinance their home loans, “which we know will be happening in light of COVID.”
It also “aims to make the homebuying process more efficient and less cumbersome,” she said. “The process is daunting, especially for first-time buyers.”
The genesis of the program grew from LEDP’s work with city council on the Longmont affordable housing program approved in 2018, which requires, among other things, that 12% of square footage in new residential developments be affordable to low- to moderate-income earners.
“We partnered with Cornerstone on data and information that informed that program,” Erickson said. “The idea began there: How can we support our employers in supporting their employees?”
Start to Home started with crafting a vision, said Lonnie Jenkins, vice president and regional market manager for Cornerstone Home Lending. Central among the goals was developing a program that was simple to use that benefited local employees and in which the majority of contributions went toward the program itself, rather than administration. A lot of similar programs dedicate most of their resources to admin rather than offering incentives to employers or employees, he said.
Vision led to outreach, and Jenkins said partners — which also include Arch Mortgage Insurance, real estate referral company Dijjit and a number of local Realtors and businesses — were receptive from the outset, as were employers.
Local employment and businesses are key to the health of the housing market, Jenkins said.
“The housing market depends largely on quality job creation and retention,” he said, adding both are strengthened when employees can live in close proximity to their jobs. “(Start to Home) is a great opportunity to support local employees and the Longmont community.
Home ownership also is a wealth-generating investment for families, Jenkins said.
But as Longmont’s appeal continues to grow to both employers and employees, housing prices have been on an upward trajectory. The average price for detached properties in Longmont in May 2010 was $232,000; the average for attached properties was $160,000, Jenkins said. Fast forward to May 2020 and those averages grew to $455,000 and $339,950, he said.
Start to Home’s credits, which can be used for closing costs, to set up an escrow account or for mortgage insurance buy-down, as well as the mortgage insurance discount, create options for people to be able to afford more for their money, Jenkins said.
“For some folks that will qualify them for more house by lowering that monthly payment,” he said, adding the flexibility of using the $2,000 credit and any contributions from their employer in a variety of ways allows Start to Home to work in a way that is going to benefit employees the most.
“We wanted to make it really easy for both employee and employer to get involved. We wanted all of the contributions participants make to go toward benefitting the employee,” Jenkins said.”In turn, we’re offering employers something of value they can give to their employees.”
Employer contributions are factored in with other contributions and partner incentives to find the best option to help employees get into their desired homes, he said.
Another benefit of the program is that employers’ contributions can help with down payments without being treated as taxable events through company payroll, Jenkins said.
Start to Home’s partnerships also allow the program to tap into some of the latest home searching and buying technology, as well as a network of highly rated national and local real estate professionals, he said.
“We wanted to create a home buying experience that is the best it can be,” Jenkins said. “We wanted to keep it as easy as one, two, three and to make sure there weren’t any kind of resources employers had to dedicate to get started. As long as an employer is a member of LEDP, (Start to Home) provides all the resources they need. They literally can just send an employee to this.”
One, two, three references the steps outlined on the Start to Home landing page: One, register for the program. Two, download the HomeScout app. And three, wait for someone to be in touch.
The resources home buyers can access through the program also are exciting, Jenkins said. HomeScout, he said, is a “robust” property search tool that is tied to every MLS in the country that allows users to access all data in real time. It also is a proprietary site and information is never shared or sold to a third party.
“That gives employers and employees peace of mind,” he said. “Many other sites that are popular are there solely to collect and sell data and probably only have two-thirds of accurate information.”
HomeScout also allows users to save their searches, save favorites and receive alerts any time the status changes on a property in which they are interested, Jenkins said.
Dijjit provides access to a network of vetted professionals, including national companies and local boutique firms, he said. “Every Realtor and loan officer participating in the program are scored;100 is the best. They have to maintain a score higher than 70 to remain in the program.”
Criteria used in the scoring system include responsiveness, on-time closings and “other factors that are really driven by the experience of the customer. We wanted to create a home buying experience that is the best it can be,” Jenkins said.
But most exciting, he said, is that Start to Home is breaking new ground.
“We built this from the ground up, there isn’t anything else like it that we’re aware of,” Jenkins said.
Cornerstone Home Lending, which is headquartered in Houston, is licensed in 41 states and Gene Humprhries, regional vice president for the company’s Mountain West region, said Start to Home could be deployed in other communities across the country if the right partners are in place.
“The folks at (Longmont Economic Development Partnership) have really been hugely instrumental in the core of this program. I think going elsewhere with it would highly depend on the ability to make the same types of connections with other groups in other municipalities in other states,” Humphries said.
He also praised Jenkins’ and the LEDP’s attention to all the details required to launch the program, and said Jenkins hasn’t crossed every T and dotted every I.
“I think we’ve put together a pretty solid plan and I do think it can be duplicated,” Humphries said.
