JPMorgan Chase announced $325,000 in philanthropic capital for Newtown Community Development Corp., based in Tempe, in support of their Community Land Trust that provides homeownership to low- to moderate-income and underserved families who are priced out of the market in metro Phoenix.
A part of the firm’s broader neighborhood development work in underserved communities, today’s announcement also builds on JPMorgan Chase’s new $30 billion commitment to help advance racial equity, address key drivers of the racial wealth divide and provide economic opportunity to underserved communities, especially the Black and Latinx communities.
The commitment would allow Newtown to create a revolving (bridge) fund to improve capacity to purchase properties to provide homeownership opportunities for low-to moderate income and underserved families. Such properties would be placed in Newtown’s Community Land Trust.
Newtown both renovates existing homes and builds new ones. In this sellers’ market in metro Phoenix, the grant would allow Newtown to buy homes faster, where cash offers are preferred over conventional financing. This would significantly improve the success rate to close on purchases. In addition, the revolving fund would allow Newtown to sell houses at lower prices, as the revolving fund can save Newtown interest associated with using loans to buy houses.
The houses will be sold to underserved and low- to moderate-income buyers that are priced out of the market. These houses will remain affordable in perpetuity, as the homeowners lease the land from Newtown in a low-cost, 99-year renewable lease that requires owner-occupancy and contains provisions that ensure the homes are affordable to future eligible buyers and families. The homeowners can build wealth through ownership and equity, but agree that if they decide to move, they will sell the home back to Newtown at a price that keeps it affordable for future buyers. Newtown repurchases any Land Trust homes that the owners wish to sell. Newtown will make repairs and renovations as needed, then resell the home to another eligible buyer
“Affordable housing is a critical issue in metro Phoenix and for many underserved families, homeownership is not attainable,” said Noreen Bishop Hill, managing director for the J.P. Morgan Private Bank in Arizona who also heads JPMorgan Chase’s local leadership team. “Helping Newton build the capacity of its innovative community land trust will benefit many families over time and help them achieve homeownership and create wealth. We’re very proud to partner with them on this project.”
“Newtown is so appreciative of this investment,” said the organization’s Executive Director Stephanie Brewer. “It will allow us to add more houses to our inventory to provide permanently affordable housing for families and individuals.”
