Housing prices in Denver are especially challenging for low- and mid-level earners right now. New teachers in the metro area spend 30 percent or more of their salaries, which average about $38,000, on housing, making saving enough for a down payment on a home nearly impossible.
To lighten the load for at least some of its staff, Denver Public Schools announced on Thursday, April 12, that it has partnered with Landed, a startup based in California, and the Zoma Foundation to launch a down-payment assistance program that will provide up to half of a 20 percent down payment on a home, or up to $70,000 per household, to about 100 teachers the first year. Teachers and school staff members who have worked for DPS for at least two years and can contribute half of a 20 percent down payment would qualify for the program.
"Given that state funding in Colorado has fallen so far behind our rapid increase in the cost of living, it is essential that we do everything to help our educators meet their housing needs while continuing to advocate for greater state funding for education,” says DPS Superintendent Tom Boasberg.
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Rather than giving out loans or grants, the program's backers will act as co-investors on the property, sharing in the loss or gains (more likely in this market) in the value of the home. When a buyer refinances or sells the home, the buyer would pay back the original down payment funding plus 25 percent of any gain in the home’s value, according to the company. Landed would reinvest any gains back in the program so that it can grow.
Denver will be the three-year-old Landed's first foray outside California, where it helps educators in the pricey Bay Area find homes. And it has the backing of Silicon Valley heavy hitters: The Chan Zuckerberg Initiative (run by Mark's wife) recently donated $5 million to Landed to help educators in northern California with down payments.
DPS has made several efforts in the past few years to assist its employees with housing. But in January, it backed away from a plan to turn a vacant elementary school in south Denver into housing for teachers. The concept would have tackled another challenge that home buyers face in Denver: inventory shortage.
DPS will host informational sessions about the Landed program on April 18, April 25 and various dates through May. For more details, visit the Denver Public Schools website.