Finding New Solutions to Low Income Housing Needs

By Joshua Glenn Ferguson MSinPM@Gmail.com

Master of Science in Property Management

Professor Mary Ann Hallenberg, J.D. Email: mmh86@drexel.edu

Goodwin College of Professional Studies

Philadelphia, Pennsylvannia January 3, 2012

Copyright

by

Joshua Glenn Ferguson

2011

Abstract
As the United States Government wrestles with financial issues and more people throughout the country become homeless, a new alternatives for low income housing that does not depend on funds from the federal government needs to be found. With a government that is looking for ways to cut back, a country in need of more affordable housing and the current desire of many to work together at solving social needs, now is a great time to determine what alternatives can aid in increasing the low income housing needs that can be embraced by a majority of Americans. Alternative funding and management of housing like a Lorem Ipsum Dolor (Community Housing Project) can be designed to be widely accepted by all social and political classes while providing an investment return for home owners. Alternative programs have the opportunity to provide additional retirement income for middle and upper middle class families while increasing the number of low income homes throughout the country while aiding the financial bottom line of banks, builders, developers, real estate agents, property managers and all those involved in the real estate industry. It will be through the pulling together of resources, talents and ideas that the housing crises in the United States can be solved, which a Lorem Ipsum Dolor is able to aid in.

Table of Contents
I. II. Introduction to The Problem Methods a. Literature Review b. Interviews c. Alternative Solution Quantitative Analysis d. Societal Approval Check III. Lorem Ipsum Dolor (Community Housing Project) IV. Results a. Interviews b. Alternative Solution Quantitative Analysis c. Societal Approval Check V. Discussion VI. Conclusion VII. References VIII.Appendices 1 8 8 9 10 11 12 20 20 22 24 26 28 29 31

Introduction to The Problem

Before presenting a new program, current low income housing options need to be explored, including government and non-government subsidized projects. The Chairman and Founding Partner of Corcorcan Jennison Companies, a successful provider of housing on the East Coast states, The federal government has really abandoned any commitment to affordable housing. Theres still a tax credit program, but thats about it. My concern is that housing doesnt get the money or attention that it needs. The tax credit program is a good program, but we dont get into it; its too difficult. (Urban Land Institute 2007) During the recent recession the need has increased significantly and in many cities low income housing stock has a zero vacancy rate. For housing not to be a financial burden, the monthly cost should be 30% or less of the household income. For Yamhill County, Oregon that means a single wage earning household must make $14.56 per hour at a 40 per hour work week job, to afford the average 2-bedroom apartment at $757 (County 2008). The mean wage for a renter in the same county is $11.10 per hour, meaning a person must work 53 hour per week, year round to afford the home. For those on SSI (Social Security Income), who average $637 per month, housing becomes even more difficult to obtain. At 30%, a person on SSI should be paying no more than $191 per month for housing which is a far cry from the countys fair market rate of $655 (County 2008). With 3/4 of the renters having incomes below the median income for all households with 30% in the lower middle quartile (Studies 2011), achieving the 30% goal of rent cost to income can be very difficult. More than 48% of the households over 62

and 52% who are disabled pay more than 1/2 their income to rent leaving little for money for food, health insurance, clothing, transportation and many other necessities. Older housing stock plays a vital roll in providing low income housing, many of these being four units or less. These homes are often in need of repair and dont meet the bare minimum legal housing standards for most states. Due to the high value of land, many of the mobile homes and older in need of repair housing have disappeared. In 2007, only 27.4% of very low-income renters received assistance and that dropped to 25% in 2009 (Studies 2011), leaving many to allocate more than 50% of their income to rent leaving little for living needs or making the choose to live in substandard housing that is often not suitable for human habitation. Reduction in government subsidized low income housing programs has created a greater need for other forms of funding. Reduction in programs, increase in housing cost and high unemployment continues to create a high cost burden for cities caring for those that cannot afford housing, the homeless. In 1976 low income housing accounted for 7% of the federal budget, by 2004 it accounted for just 2% (County 2008). This meant that states had to increase their funding for these projects but many states, like Oregon, have only been able to replace 10% of the original funding amount. Smaller counties and cities have suffered the most as federal and state programs are difficult to distribute in smaller projects like that which is needed in a city of less than 10,000 people. Yamhill County, Oregon has lost almost 9.5% of their available low income homes since 1990s, yet the county has grown substantially. This has increased the number of homeless and increased the housing burden on many.

The larger counties and cities are not immune to problems caused due to the reduction in low income housing. In 2001 the City of San Francisco spent spent $200 million on the homeless, not including $100 million on acquiring existing dwellings to build new permanent affordable housing (Davis 2004). This equates to the city spending $2300 per homeless individual. Federal studies in the mid 1990s showed it cost $8000 a year for 1 emergency shelter bed. That equates to over $650 per month, substantially more than the average studio in 95% of the country. Cost to care for homeless have increased, the number of homeless have increased, the number of low income homes has decreased and the burden on the taxpayer has increased. The current programs are not adequately keeping up with the need. There are multiple government funded programs that involve the federal, state, county and city governments. The federal government has two type of formats that are the most popular including tax credit for owners to encourage lower rents and vouchers for tenants to allow for flexibility. Both of these programs are designed to reach the most vulnerable including seniors, the emotionally, physically and mentally disabled, single parent families and not necessarily focused on those whos goal is to pick themselves up with their boot straps. The tax credit programs include many rules and regulations, as noted by the book turned out by the United States Congress House of Representatives book, To Establish a Federal Housing Trust Fund to Provide Decent, Safe, and Affordable Housing for LowIncome Families Lacking Such Housing. The LIHTC (Low Income Housing Tax Credit) is the most popular and the key program used for comparison in this paper. The

LIHTC program was created in 1986 as a way to transfer government housing into private ownership from government owned programs. Since 1986 the program has produced 1.9 million units through the selling of tax credits or other forms of equity over a 10 year period (Studies 2011). There is a high development cost associated with these projects due to government requirements which Silverwood Associates estimates to be from $120,000 to $400,000 in staff time for simply submitting for an LIHTC project (Myerson 2007). The high cost of development along with the on-site manager requirement means most projects are built in larger cities. High cost of development lowers the amount available for additional housing and encourages larger complexes in concentrated areas which has proven to be less effective in positive community integration. The USDA Rural Development Program (rental housing programs) includes multiple programs to assist housing for smaller counties and cities. One of the programs is the Farm Labor Housing Program (Section 514/516) which provides low-interest loans and grants for housing for farm labor (USDA 2010). The Rural Housing Guaranteed Loan Program (Section 538), another USDA program, provides loan guarantees for affordable housing in rural areas. This program is intended for those who earn less than 115% of the median income. The Rental Assistance Program (Section 521) is a third program available through the USDA Rural Development Program. It is similar to the section 8 program, covered later in this report, but is specific to rural areas. Section 521 ensures people do not pay more than 30% of their income for housing. The last program available from the USDA is the Housing Preservation Grant (HPG) Program which

provides assistance in upgrading / updating rural housing, whether it be owner occupied or rental (USDA 2010). All four of these programs help increase low income housing in rural areas but none of them have been able to keep up with the increased need of low income housing. The voucher programs support 3 in 10 assisted renters with 2.1 million housing vouchers in use. Voucher programs allow for the tenant to choose the location of the housing, assuming the owner will accept the program. Many landlords throughout the country do not accept the voucher due to the restrictions that come with them, including difficulty in evictions, forced rent payment dates and more. This program gives the greatest flexibility to the tenant but does little to reduce the cost of housing. Additional government programs include the Historic Preservation Tax Credit, the Community Development Block Grants, the HUD Section 202 Supportive Housing for the Elderly, Low or No Cost Loans, and Tax-Exempt Bonds. Historic Preservation Tax Credits are often done in conjunction with LIHTC projects to encourage the preservation of older buildings. CDBGs (Community Development Block Grants) have built 1.4 affordable homes from 1987 to 2000 (Schmitz 2005) by distributing approximately $4 billion every year for states to use in assisting low income housing projects. HUD Section 202 Supportive Housing for the Elderly provides 100% funding for housing of seniors. States will often offer low or not cost loans when combined with LIHTC projects to encourage such projects. Many states also offer Tax-Exempt Bonds to lower the cost for non-profit and government funded projects. Many of these projects work in

conjunction with public and private sector subsidies including donated land, fee waivers by the county or city, property tax exemptions and philanthropy. Non-profit REITs (Real Estate Investment Trusts) have recently been introduced to the real estate market place thanks to The Community Development Trust. They area a privately held REIT that concentrates on the low income housing market utilizing private and government funding together (Trust 2011). The Community Development Trust started in 1998, running the business similar to a mutual fund with a focus on investing in low income housing. To meet their company objective, they require all programs to be in line with the Community Reinvestment Act. By utilize long-term debt to purchase smaller, fixed-rate multi-family mortgages from community lenders who are looking to full fill their CRA credits, they are able to purchase projects of less than $5 million. Returns for private investors are similar to a standard REIT. Payout from sales of the investments are higher than the original investment, cash dividends are payed out from the project one has invested in and there is the possibility of eliminating ones tax liability by investing with shares in CDTs Operating Partnership. They are able to meet their mission of providing low income housing while have a competitive return for their shareholders. Many cities throughout the country have inclusionary housing requirements. This means they require a percentage of homes in any given new development to be designed and priced for those with lower incomes. This can create a fiscal issue for the development company if they are not able to utilize any government funding assistance. It has worked well to increase low income homes in newer areas of a community, but

does nothing to encourage a builder to build such homes in a manner that best fits the communities needs and desires nor is there a financial incentive for the builder unless they are able to obtain government financial assistance. Government programs for low income housing have come and gone over the years. They have shown that none of these can be relied on, as they are at the mercy of tax revenue and political turmoil. Private programs have helped but all to often rely on government support in conjunction with private support. At this time, none of these programs have been able to keep up with, let alone increase the number of low income homes needed throughout the country.

Methods
The current programs used for low income housing have aided in understanding how the programs are ran and to what extent government involvement exists. Using literature published from industry professional groups helped highlight current problems seen from the corporate and government side of the industry. This introduction has helped lay the ground work for problems existing in the current program that have been supplemented by interviews from multiple individuals. Literature Review The proposal examines the need for affordable housing by using more recent writings by the Urban Land Institute, The National Low Income Housing Coalition, Novogradac & Company, the National Alliance to End Homelessness as well as other writers knowledgeable of the subject. Source #1 Novogradac & Company has a book called Introduction to Low-Income Housing Tax Credits that explains how the program works, which has been utilized for explaining the most popular program currently used (Novogradac, 2010). Done utilizing quantitative research, this book highlights some of the difficulties with LIHTC projects as well as helps define how banks and businesses currently utilize LIHTC funding and wraps up by teaching the reader how they too can do forecast funding for such projects. The book is written in a very simple to understand format and is currently used to further the knowledge of someone who has attended Novogradac & Companys basic workshop

on the LIHTC program. The information helped explain the current program and what problems currently exist with it for the proposal. Source #2 The National Low Income Housing Coalition has written a report called Out of Reach that gives current facts on income versus housing costs (The National Low Income Housing Coalition, 2011). By utilizing qualitative studies done by the U.S. government, they can show current household income and cost of housing, both for rental, and ownership. This information is gathered in a way that helps the reader note the current problem of household income verses housing cost in many areas throughout the country. Throughout the report this information is used as a basis for cost and need for those living in or needing low income housing. Source #3 Adrienne Schmitz, through the Urban Land Institute, has written a book about designing and building high quality low income housing (Schmitz, 2005). This observation style book, looks at multiple successful low income properties in different areas of the country. Information on these properties helped with the design of the alternative solution being introduced. This book, along with others, is utilized in helping to determine the way the homes can be designed and constructed with the proposed projects. Interviews Convenience sampling has been used to determine what additional areas of exploration was necessary to obtain an alternative low income housing project accepted

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by the majority of society. A dozen individuals with various backgrounds have been interviewed. Those interviewed included high to low income individuals, conservatives and liberals, those getting government subsidizes to those that never have, individuals in property management including ones who have run government subsidized properties, religious leaders, and real estate developers of current government programs like the LIHTC program. General observance was noted to see what areas of the current programs people like, do not like and what areas can be improved. This includes both the financial knowledge as well as phycological and physical knowledge of the current program. The questions included: 1. What do you know about low income housing? 2. What do you know about government funding of low income housing? 3. What do you see as the positive items brought forth by low income housing 4. What do you see as the negative items brought forth by low income housing? 5. What is a key issue you would like to see addressed with current low income housing programs? Judgment sampling has been used in this process because low income housing affects everyone in a community. Alternative Solution Quantitative Analysis The research hypothesis is introduced utilizing a development proposed in Dundee, Oregon. An Excel spreadsheet for data analysis is introduced to show that the project is fiscally achievable with the Dundee development. This quantitative analysis is the cornerstone into proving that the proposed alternative is not a financial burden upon

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the local community. The spreadsheet takes into account the cost of building such a project, the net operating income, gross income multiplier, capitalization rate, mortgage cost, before tax cash flow, equity dividend rate, debt coverage ratio, net present value, internal rate of return, and taxable income of the project. This information is used to determine how the project will financially affect those involved. It is expected that without a financially positive outcome the project would not be accepted by those surveyed. Deducting the outcome of the financial analysis is what set the basis for the final survey or societal approval check. Societal Approval Check This project is a good example of the concept of instrument reactivity as the measurement can be adjusted to fit the objectivity desired. It was the adjusting of the quantitative analysis that was necessary to determine to what extent such a project is feasible. The final survey was a random online survey that included investment and donation amounts which help validate the hypothesis. By comparing the one-on-one interviews to that of the random sampling, a testretest reliability of the surveys was done. Doing a random sampling, online survey allowed for a much broader audience and kept the cost low. Confounding variables found during this process have been addressed during the conclusion.

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Lorem Ipsum Dolor (Community Housing Project)

To be successful, an alternative low income housing program should proactively engage the local community and be capable of getting money from non-government sources through a pool of investors that fit the communities best interest. In her book, The Life and Death of Great American Cities, Jane Jacobs emphasis the importance of catalyzing diversity, something she notes is not carried out within suburban tract housing or any many modern city designs (Jacobs 1961). A Lorem Ipsum Dolor (Community Real Estate Investment Trust) has been designed to better integrate low income housing into the community while not using government funding and without the need for major political or legal changes. A REIT (Real Estate Investment Trust), allow for large pool of investors to come together to achieve a similar goal. This same basic concept can be used for an alternative program, a Lorem Ipsum Dolor. The difference between a REIT and a Lorem Ipsum Dolor is how the funds are gotten and the type of properties the group focuses on. On a REIT the funds are gotten from money available for investment from retirement plans or those with investment monies available. To get the monies needed to build low income housing,m a Lorem Ipsum Dolor creates a loan from a homeowner that is attached to the real property but not based upon the value of the housing, but instead based upon the Lorem Ipsum Dolor program. When a new home is purchased an additional loan is attached to the home to cover the cost of the Lorem Ipsum Dolor for the area. The loan is separate of the conventional owners loan, yet attached to the land through local municipality approval

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or through CC&Rs, depending upon local laws with a goal of having most, if not all, of the loan amount paid by the renters that live in the Lorem Ipsum Dolor housing. Like a REIT, the Lorem Ipsum Dolor will need a Board of Directors based from the owners election. The Board of Directors will help choose what market they are looking to assist within the low income classifications. The continuum includes:

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15

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* The new continuum added via a Lorem Ipsum Dolor.

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A Lorem Ipsum Dolor is designed to cover the entire housing continuum for nonowner occupied homes (Davis 2004). The Lorem Ipsum Dolor board should have a minimum of a five people with one representative from the bank. It will be the board who determines the type of project(s) to be considered along with the developer, when a new development is being considered. On pre-owned homes, it will be the Lorem Ipsum Dolor board that will make the decision on the project desired. The Property Manager of the units should also be present at board meetings, but they should have zero voting rights. To ensure the Property Manager is achieving the goals of the organization, the Board will want to outline the rules and regulations expected by the organization. The Property Manager can help guide the board in ensure they follow all federal, state and local laws. Working with the Lorem Ipsum Dolor Board, the Property Manager can also help design the rental Lorem Ipsum Doloreria as they are most likely not to follow industry normal rules and have areas of options that the Board may approve. This is the same for the rules for eviction. Standard rules for eviction may not apply for such project and can, or should include, possible board approval prior to eviction, additional options provided and outside party assistance options for those with emotional, mental or physical needs. With the assistance of the Property Manager the Board can determine rental Lorem Ipsum Doloreria as well. Application rules should include income requirements, proof of income requirements, continual income limits with the possibility of an exception to the rule by majority rule of board.

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A percentage of the Lorem Ipsum Dolor units will need to be done as a percentage of the need for the area minus current low income housing stock. That means if 100 homes are being built and there is a 10% need for low income housing in the area, and there are already 5 LIHTC homes, then 5 additional Lorem Ipsum Dolor funded homes should be considered. Loan amounts for investment in the project could be a set amount. That means for every $100,000 value of a home, an owner would invest $5000 in the project. The Lorem Ipsum Dolor loan could be flexible giving different options for multiple owners. They should include a $0 down option, as the loan amount is not directly related to the home. This loan should also not be dependent on the home owners income, as it is not expected to be an additional monthly financial burden on them. A Lorem Ipsum Dolor will need the state to allow cities to set a percentage of low income housing standards to help promote such a program. They will also need remove or add laws that allow for cities to require a specific number of homes to be classified as low income. Property management firms not related to the Lorem Ipsum Dolor, or any of the share holders, should be utilized to reduce the liability of the organization. The firm should also not be connected to any political group that may negatively affect the outcome of the home(s) managed or any group that may be associated with the developer of the project. An outside auditing group can be used to ensure compliance as well as help with the setup. This group should not have any ownership of the project, not be directly

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connected to the development company, the property management firm, the Lorem Ipsum Dolor board or should there be any one doing the audit that has a political position that may affect the outcome of the project. Though federal or state funding would not normally be used for such projects, easing zoning rules for builders, expediting the permitting process or reducing the cost of such permits is a way for these projects to be more successful. To encourage builders and banks to embrace the program, cities could implement a minimum number of new low income homes that must be produced with new construction projects. This means that the planning departments of the city can help support the organization though the entitlement phase. In addition cities, counties, states and the federal government should look at eliminating tax gains made from this alternative investment. Easy financing options are necessary for acceptance of such a project. Local banking partners should be used to promote and encourage the project. Banking packages that offer low rates which are attached to the project and not the persons own home loan, would be best to minimize confusion and maximize payout to the Lorem Ipsum Dolor owner. A Lorem Ipsum Dolor is a much simpler project than the current LIHTC project, especially since it focuses on leaving government funding out of the equation. Proper design will help promote and aid in the growth of additional low income houses like a Lorem Ipsum Dolor program.

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Results
Interviews to determine what the general public sees as the problem to low income housing so that they are more accepting of an alternative, a financial analysis of a proposed project to see if such an alternative is financially feasible and a questionnaire to show that the majority of society would accept such a project has been used to determine if the proposed alternative to low income housing is feasible. Interviews Of the dozen individuals interviewed about low income housing, only one knew details about the low income housing that is currently provided. This individual is currently a Property Manager of a low income housing complex in Hillsboro, Oregon. The Property Manager of conventional properties did understand that many of the low income homes are provided by non-profit organizations but realizes there are many for profit organizations also providing housing. The remaining ten did not know how the housing received funding, who benefited, who paid or if they had any input as to what or how such housing is managed. None of the twelve recognized the need for low income housing to be a place for those with mental, physical or emotional handicaps that prevented them from being able to move beyond the subsidized housing. Neither did the twelve recognize the need for those with prior criminal back grounds needing a place to live otherwise they would add to the homeless count and their lifestyle would encourage additional criminal activity. All but one person interviewed, including those that leaned more on the liberal side of

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politics, commented about low income children being the cause of more problems within society. Seventy Five percent of those interviewed did recognize that many who have minimum wage, or near minimum wage, incomes would most likely need to live in subsidized housing. Only those that leaned towards the liberal side of the political spectrum, half of those interviewed, favored government assistance with housing. Additionally, all individuals that stated they had a more conservative political belief, also noted a lack of accountability from the low income individuals and they believed many made poor choices, thereby creating a cycle of people who had been born into a system of government support that do not have the desire to move away from it. All interviewed believed it was a lack of proper education that kept children living in low income household from succeeding to the same level as that of middle and upper middle class children. All twelve interviewed agreed that integrating low income households with that of middle and upper middle income households would help improve the chances of success for low income families, especially the children. Only one of the twelve, the wealthiest of the conservative people interviewed, stated he would not live in a neighborhood that included low income housing. The remaining eleven stated they would be much more inclined to choose a neighborhood with low income housing if they had some control over the size, management and overall project.

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Alternative Solution Quantitative Analysis Dundee, Oregon, a city of 3096 people (Advameg 2010), has recently approved a new development that will house approximately 2500 more individuals. The new subdivision will be used as a basis to determine the financial outlook of the proposed alternative, though the land is not currently for sale. It also assumes the home is for a family of two, a single parent with a child, with a rent amount that is no more than 30% of the mean income for an Oregon worker. Affordable housing, according to the U.S. Department of Housing and Urban Development, is housing that cost no more than 30% of the collective income of the household (Schmitz 2005). In Oregon, the fair market value of a two bedroom apartment is $822 (Coalition 2011) and the state mean income for a renter is $12.05 per hour, or $25,064 per year (Policy 2011). Thirty percent of that income comes to $627. The LIHTC (Low Income Housing Tax Credit) program currently states that a two bedroom home for 2 people, with the income being 50% of the median wages or $24,700 per year, should cost $628. Using Building-Cost.net, a simple two bedroom, 4-sided duplex, with each side having 750 square feet and basic appliances, cost $133,582 to build. This includes all soft and hard costs as well as a contractors mark-up of $17,024, not including the land (Company 2009). Dundee does not currently have land for sale that would accommodate a multiplex or a single family middle class home. The neighboring city, Newberg, does and they range from $49,000 to $70,000 (RMLS 2011). As the price for land for the two cities is similar, the price of the land is assumed at $50,000. This include

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a $20,000 discount for the land from the developer to help full fill the Mayor of Dundees goal of increasing low income housing in a non-obtrusive way to the local community. As the alternative is intended to encourage local bank involvement, West Coast Bank, the only bank in Dundee and one that was started in Oregon, was used as the basis for the loan rate amounts. As of November 18th, 2011 the rate for a 30 year conventional loan was 4.12% (West 2011). To cover initial consultation fees, a 6% loan fee was used. The alternative program is directed towards middle class housing, so the tax rate is assumed at 28%. The estimated property tax rate for duplex in Dundee is $2244. Expense escalator is estimated at 3% while the income escalator is estimated at 2%. The vacancy rate is written in as 5%. Annual real estate asset growth a small 2% as adjusted for the current and expected future economy. The operating reserve is assumed to be total rents received per month time two. There are three properties used as the comparables that range in sale price from $141,500 to $144,900. Two are located in Dundee and one is located in Newberg. They are older duplexes who charge $94.33 to $94.34 per square foot with a total square footage of two units from 1500 to 1536. Using the noted figures, the 30-year annual monthly mortgage payment becomes $926. The NOI (net operating income) is $10,305 in the first full year with the operating expenses being 26.37% of the effective gross income. GIM (gross income multiplier) in that first full year is 13.56x which is higher than older conventional properties in the community that have a GIM of 8.56x to 8.94x. Cap rate is also lower than comparable properties during the first full year at 0.0505 verses 0.0800 to 0.0838. Using the

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Capitalization rate method, the property has a terminal value of $368,984 and an R value of 0.0498 on the 6th year. DCR comes in at 1.08 on the first full year, declining to below the 1.0 mark on the 7th year. The net present value, ATCFs (after tax cash flow with sale), on the first full year is $141,644 with no consistent positive cash flow happening until the 10th year. The IRR (Internal Rate of Return) is difficult to utilize in this alternative project as, it is assumed there is $0 down. The property shows a BTCF (before tax cash flow) of negative $812 during the first full year. The median home in Dundee is $278,000. Assuming the Lorem Ipsum Dolor (Community Real Estate Investment Trust) had an owner invest $5000 for every $100,000 a home is valued at, the duplex suggested would need 14 home owners. Those owners would then each need to pay $58 per year before taxes, for their investment. The equates to a little more than $4.84 per month for every investor. Two low income houses for every 14 middle class, to upper middle class home equates to 14.29% of a community. Societal Approval Check Societies willingness to invest in a low income housing project is vital to the success of such a project. The survey and quantitate analysis of the financial data indicate that such a project would be widely accepted however a small number of people (39) had been surveyed due to time and financial constraints, so a more detailed survey with a much larger number of people would be appropriate before such a project was considered universally accepted. Over 28% of those surveyed donated 0 to 1% of their income to organizations that assist others. There was no consideration for income in the questionnaire, so it is likely

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that those that do not donate are the very same that would be needing low income housing them selves. Investment returns for many are on the lower end for most who took the survey with over 84% making less than 5% on their current investments, like IRAs, real estate or 401K. More than 62% of the respondents stated they would invest $5 or more per month, assuming they received a minimum of a 3% return on their investment, on low income housing. With the financial analysis showing a $5 out of pocket expense per month for the investor in Dundee, it assumed a minimum of 62% of those surveyed would accept the project on a financial level. An IRR is impossible to determine utilizing the Dundee project as it is expected that there is a $0 out of pocket expense for the investor. Such a return would satisfy 100% of those on the survey, including the one individual who expected an 11% return on a low income housing investment. One area needing explored in more detail is that of acceptance by the middle to upper middle class individuals accepting such housing near their own.

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Discussion
A more holistic approach, that involves those from all sectors of society, to low income housing is desired by those questioned about low income housing. Interviews done showed a desire to improve the current situation while not increasing the nations deficit. A Lorem Ipsum Dolor was designed to help do what those interviewed had asked for. Everyone interviewed desired to improve the current low income housing structure, but no one realized how it was done or who it was designed to serve. Explaining to these individuals the need for housing those who are mentally, physically or emotionally handicapped opened up their hearts and minds to the needs of others. It also got them to come up with ways and ideas on how they could help. By bringing those in need with those that have together, a community will create its own support system, thereby reducing its need for government support. A Lorem Ipsum Dolor moves a low income housing project from one that needs additional philanthropic support to one that has a large pool of individuals brought together, giving a much larger pool of money and possibilities. The design allows for a profit to be made by the individual home owner that invest in the Lorem Ipsum Dolor and it encourages multiple personalities and back grounds to help the residents succeed. Everything from the soft liberal who will provide positive emotional support when needed, to the hard conservative who will push the person to be a better part of society, as well as the social worker who can help the person navigate local, state and federal

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programs for help, and even the construction worker who can help keep the cost of building, repair and reconstruction down. The proposed Dundee project proved via the financial analysis, that a Lorem Ipsum Dolor is possible, however there is the risk that in other communities such a project would not turn out as well financially or that a project would even meet the goals of the projection. Projections for any real estate project is a best guesstimate and that of a Lorem Ipsum Dolor is no different. Once a larger more comprehensive survey is done, that includes a broader spectrum of people throughout the country, the actual societal approval can be determined. There is concern that those in lower income areas or in more conservative areas would be less likely to join such a project though early indications have proven otherwise. Rich and ultra rich individuals will most likely favor the traditional model, as it favors their financial needs much more than the proposed program.

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Conclusion
Carol Galante, the President and CEO of BRIDGE Housing Corporation has said, A statewide housing trust fund is high on my wish list (Myerson 2007). A Lorem Ipsum Dolor could be what she was asking for, even if it is not what she envisioned. A Lorem Ipsum Dolor is highly complex concept that will need further examination and review. The initial research of such a project has shown that it should be well received by the local community and be financially positive for those that invest in one. As stated in the Bible, When you reap the harvest of your land, do not reap to the very edges of your field or gather the gleanings of your harvest. Do not go over your vineyard a second time or pick up the grapes that have fallen. Leave them for the poor and the alien. (Moses 1440 B.C.). A Lorem Ipsum Dolor gives the middle and upper middle class an opportunity to assist the poor utilizing the edges of their harvest while giving dignity to the low income individuals through the opportunity to work for their needs.

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References
Advameg Inc. (2010). "Dundee, Oregon, City-Data." Retrieved April 28th, 2011, from http://www.city-data.com/city/Dundee-Oregon.html. The Community Trust. (2011). "The Community Trust; What We Do." Retrieved October 19th, 2011, from http://www.cdt.biz/whatwedo.htm. Craftsman Book Company. (2009). "Building-Cost.net." Retrieved 11/2, 2011, from http://building-cost.net/CornersType.asp. Davis, S. (2004). Designing for the Homeless. Jacobs, J. (1961). The Death and Life of Great American Cities. New York, Random House. The Joint Center For Housing Studies. (2011). America's Rental Housing. M. Fernald. Cambridge, Harvard University: 52.6 Moses (1440 B.C.). Leviticus - Quest Study Bible, New International Version. Grand Rapids, Zondervan. Myerson, D. (2007). The Business of Affordable Housing, Urban Land Institute. The National Low Income Housing Coalition. (2011). Out Of Reach 2011. The National Low Income Housing Coalition. Washington, National Low Income Housing Coalition: 217. Oregon Center for Public Policy. (2011) HUD Median income Limits for Oregon Compared to Poverty Income, 2011. 1 RMLS (2011). "RMLS Search Land." Retrieved 11/10, 2011, from http:// www.rmls.com/RC2/UI/search_land.asp.

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Schmitz, A. (2005). Affordable Housing, Urban Land Institute. Urban Land Institute. (2007). The Business of Affordable Housing, Urban Land Institute. USDA (2010). "USDA Rural Development." Retrieved 10/19/2011, 2011, from http://www.rurdev.usda.gov/hi/rural%20housing%20programs.htm. Yamhill County. (2008). "Homeless in Yamhill County - Fact Sheet." Retrieved 02/15/2010, 2010, from http://www.co.yamhill.or.us/homelessness/home_index.asp? sel=facts. West Coast Bank. (2011). "West Coast Bank - Mortgage Rates." Retrieved 11/08, 2011, from https://wcb.mortgagewebcenter.com/CheckRates/GreatRates.asp? PID=23&r=1.

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Appendices
Loan Information

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