Harvard has partnered with the Allston Brighton Community Development Corporation to form a novel homeownership initiative intended to stymie a destabilizing trend—the increasing number of transient renters in the Allston-Brighton area.
A few months ago, Bettina Hein, founder and CEO of a YouTube advertising technology company, was reaching the end of her rope. Hein, who at that time lived in Cambridge with her husband and two young children, was struggling to find a new house in Brighton.
Hein finally found the perfect home, located within a seven-minute walk of the school her children will attend, only to be outbid.
“The market is really tight in that area,” Hein said. “There’s about an average of one house a month coming on the market.”
Though she did not know it then, Hein had been outbid by the ABCDC, an organization dedicated to creating affordable housing and educating first-time home buyers, which bought the house as part of its All Bright Homeownership Program.
So far, the homeownership initiative has bought three homes and resold two, according to Valerie K. Frias, the associate director of the ABCDC. One of those ended up being Bettina Hein’s dream home, which she eventually bought.
The ABCDC initiative began as an idea roughly four years ago and was first implemented last summer, Frias said. Overseen directly by the ABCDC, the program buys up homes in Allston and Brighton and resells them under an owner-occupancy deed restriction, which stipulates that the owner must live on the property.
“The goal is to increase owner occupancy and stability to bring a real sense of community,” Frias said. She added that the program “is designed to essentially stem the investor trends in the north Allston, north Brighton neighborhood.”
In recent years, investors both foreign and domestic have come to dominate the housing market in Allston and Brighton, overpaying for area homes with ready cash and then converting them to profitable rental units.
Recognizing investors’ chokehold on the market, Harvard “committed to contribute” to the new homeownership program after discussions with local residents, according to Harvard spokesperson Brigid O’Rourke. The University donated $3 million to the initiative as part of its community benefits package, detailed in the master plan for its Allston developments.
“Harvard provided [the] grant money that became the foundation for the program,” said Sarah Kitterman, senior loan officer at Boston Community Capital, a nonprofit community development financial institution that backs the homeownership initiative.
Kitterman said Harvard’s $3 million constituted a “critical layer of equity capital” which the ABCDC could then leverage to raise more money. Armed with Harvard funding, the fledgling program approached BCC for a loan.
BCC did not disappoint, providing up to $5 million for a line of credit. In total, the homeownership program has easy access to $8 million, enabling it to act “very quickly” when purchasing property and thus making the program competitive with cash-paying investors, according to Kitterman.
“This program is the first of its kind in the nation,” O’Rourke wrote in an emailed statement. “[It] exemplifies the real impact that can emerge from leveraging shared resources.”
Indeed, the program has already had made an impact. Just weeks after outbidding the Heins for the house, the ABCDC put the property up for sale again. “We were thrilled,” Hein said.
Despite an increase in price, Hein and her husband jumped at the opportunity to buy the house after meeting with Frias and learning about the homeownership program.
“Did I resent having to pay 40 grand more than I wanted to? Yeah,” said Hein. “But I got the house I wanted and I do think it’s in general a good thing for the neighborhood, I’m super happy that they’re doing this.”
She added that the program must walk “a fine line” in future, taking care not to drive up prices in the area to the detriment of lower-income families. In the end, however, she said she believes the program’s positive impact outweighs any increase in prices.
Upon learning of Harvard’s role in the program, Hein laughed.
“Honestly, Harvard is a contributor to the price inflation [here],” she said. “So I think they’re wise to do that.”
–Staff writer Hannah Natanson can be reached at email@example.com. Follow her on Twitter @hannah_natanson.
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