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HUD Archives: News Releases

HUD No. 99-101
Further Information:For Release
In the Washington, DC area: 202/708-0685Saturday
Or contact your local HUD officeJune 12, 1999


Comments on Raise the Roof Day

Includes Teacher Next Door Initiative

NEW ORLEANS - Housing and Urban Development Secretary Andrew Cuomo today announced a four-part Cities 2000 Agenda to increase homeownership and create more affordable housing in America's cities. The Agenda includes a Teacher Next Door Initiative to give public school teachers a 50 percent discount on HUD-owned homes in economically distressed neighborhoods.

"Working with mayors across this country, we will create more homeowners and more affordable housing in America's cities to attract new residents, increase the tax base, spark economic development and create jobs," Cuomo said. "The Clinton-Gore economic policies have strengthened America's cities and now is the time to do even more."

Speaking to the U.S. Conference of Mayors meeting in New Orleans, Cuomo said the Cities 2000 Agenda will:

  • Help more teachers become homeowners to help revitalize communities where they work through the new Teacher Next Door Initiative.

  • Cut HUD's Federal Housing Administration mortgage insurance premiums for first-time homebuyers who buy homes in central cities and participate in housing counseling programs.

  • Increase capital investment in cities and increase the availability of affordable mortgage financing for low- and moderate-income American families.

  • Mobilize thousands of volunteers around the nation to rehabilitate deteriorated and abandoned housing on Oct. 16, through a new volunteer initiative called Raise The Roof Day. This will maintain the supply of affordable housing for low- and moderate-income families in many cities. (See list of 48 participating cities at end of release).

Cuomo said the four initiatives are part of a drive to reduce the homeownership gap dividing America's cities and suburbs, and to accelerate the revitalization of cities begun under the Clinton-Gore Administration after decades of urban decline. While 73.5 percent of suburban residents own the homes they live in, only 50.3 percent of urban residents are homeowners.

Here are details on the four initiatives announced by Cuomo:


The Teacher Next Door Initiative - to take effect August 1 - is modeled on HUD's Officer Next Door Initiative, which President Clinton announced in 1997 at the U.S. Conference of Mayors meeting. So far more than 2,700 purchase contracts for HUD-owned homes have been accepted from officers at 50 percent of each home's appraised value.

"When we help teachers save money on homes in poor neighborhoods, we help revitalize those neighborhoods," Cuomo said. "The Teacher Next Door Initiative will attract teachers to live and work in urban school districts where they are needed most, and will give them new opportunities to mentor their students outside the classroom."

Homes offered for sale at half price under both the Teacher Next Door and the Officer Next Door Initiatives were previously insured through FHA and then foreclosed when owners failed to make mortgage payments. The homes are located in designated revitalization areas. Revitalization areas are typically in low- and moderate-income neighborhoods, have many vacant properties, and often have high crime rates. They are considered good candidates for economic development and improvement.

About 6,000 of the 40,000 homes nationwide currently owned by FHA are in revitalization areas. Single-family detached homes, condominiums and townhouses are all eligible for the program.

Neither the Teacher Next Door nor the Officer Next Door Initiatives cost taxpayers any money. Cost-saving management improvements allow FHA to reduce the price of homes and reduce its mortgage insurance premiums to teachers and officers. No tax dollars are used to fund FHA programs.

Any public schools teacher who is employed full-time is eligible to purchase a home under the Teacher Next Door Initiative if it is located in a revitalization area within the school district in which the teacher works. Teachers will be required to live in a home purchased under the initiative for at least three years.

Teachers must use a real estate broker to arrange the sale. Alternatively, a local government or school district can purchase the house from HUD and then sell it to the teacher. Teachers can contact their local HUD office for information on the availability of properties in their area.


The FHA mortgage insurance premium will be cut by a quarter point for first-time homebuyers in central cities who participate in housing counseling, down from 1.75 percent for other first-time homebuyers who participate in the counseling programs. This will reduce financing costs by $250 on the average FHA-insured mortgage of $100,000.

When coupled with reductions announced earlier, the upfront FHA insurance premium for first-time homebuyers in central cities who receive housing counseling will be 1.25 percent. The total average reduction in financing costs for qualifying urban homebuyers will be $1,000 since the start of the Clinton-Gore Administration.

Central cities are cities that are the major communities in a metropolitan area.

Cost-saving management improvements will allow FHA to reduce its mortgage insurance premiums, Cuomo said.

To qualify for the premium reduction, prospective first-time homeowners must successfully complete the Homebuyer Education and Learning Program, a 16-hour course that covers such topics as how to select the right house and mortgage, household budgeting, managing credit, and home maintenance and repair. Homeowners who complete homebuyer counseling programs are less likely to default on their mortgage payments.

FHA insured about 1 million home mortgages in 1998, and has insured about 5.5 million home mortgages since 1993. Without FHA insurance, many families would be unable to get mortgages to become homeowners.


FHA and the Federal Home Loan Bank announced an agreement to work together in a new partnership to increase the capital investment in cities and to increase the availability of affordable mortgage financing for low- and moderate-income American families. The initiative is expected to stimulate millions of dollars in new mortgage loans by private lenders.

The New England Region is the first area of the nation to participate in this effort. The Federal Home Loan Bank of Boston signed an agreement with HUD this week to launch the demonstration program for the banks it services in Massachusetts, Vermont, New Hampshire, Maine, Rhode Island and Connecticut.

Under the initiative, lenders and FHA will work to streamline and speed up the handling of applications for mortgages and mortgage insurance by developers who want to build or rehabilitate affordable apartment projects with 5 to 50 units. Currently, many developers of these small projects find the process of applying for mortgages and FHA insurance too costly and time-consuming. In addition, many lenders have focused on providing mortgages to larger apartment projects.

Under the initiative, banks will also launch marketing and outreach efforts to reach potential small apartment developers and will train their staffs to work with such developers and help them access HUD programs.


Raise The Roof Day is an effort to mobilize thousands of volunteers around the country on Oct. 16 to rehabilitate deteriorated and abandoned houses and apartments to maintain the supply of affordable housing for low- and moderate-income income families.

HUD will bring together national and local non-profit groups, faith-based organizations and local governments to recruit and work with the volunteers. Groups already signed up for the project include: Habitat for Humanity, Christmas in April, the Enterprise Foundation, Local Initiatives Support Corporation, and YouthBuild USA. So far 48 mayors have agreed to have their city governments work in partnership with local groups to carry out projects in their cities.

"Raise The Roof Day aims to help recycle the aging and run-down homes of the past and turn them into homes for the future," Cuomo said.

Raise The Roof Day is also designed to increase public awareness about the need for affordable housing and highlight the ongoing good work of groups and local governments.

Mayors in the following cities have agreed to promote Raise The Roof Day:

Albuquerque, NM Hartford, CT Salt Lake City, UT
Anchorage, AK Honolulu, HI Santa Ana, CA
Atlanta, GA Jacksonville, FL San Antonio, TX
Bangor, ME Kansas City, KS San Buenaventura, CA
Birmingham, AL Knoxville, TN San Juan, PR
Boise, ID Little Rock, AR Santa Fe, NM
Boston, MA Los Angeles, CA Seattle, WA
Burlington, VT Louisville, KY Shreveport, LA
Casper, WY Manchester, NH Springfield, IL
Cincinnati, OH Milwaukee, WI St. Louis, MO
Dallas, TX Minneapolis, MN Tampa, FL
Denver, CO New Orleans, LA Tucson, AR
Des Moines, IA Omaha, NE Tulsa, OK
Flint, MI Phoenix, AZ Wilmington, DE
Fort Worth, TX Portland, Ore.
Grand Rapids, MI Reno, NV
Greensboro, NC Richmond, VA


Tom Jones, Managing Director, Habitat for Humanity International - "We are grateful for Raise The Roof Day and its focus: to bring more persons to a deeper commitment to making a decent place to live a reality for every single human being. Habitat for Humanity International will urge all of its 1,490 affiliates in the United States to participate in "Raise the Roof Day" and will be supportive in other ways as well."

Dorothy Stoneman, President, YouthBuild U.S.A. - "Young people in low-income communities are eager to be active partners in rebuilding their neighborhoods, transforming abandoned shells into beautiful new homes for all who need them. Raise The Roof Day will give YouthBuild trainees in many cities a wonderful chance to work with public and private partners."

Patricia Riley Johnson, President & CEO, Christmas in April U.S.A. - "Christmas in April, as one of the leading volunteer rehabilitation program in America, applauds HUD's initiative to bring new awareness to and involvement in assuring all families a safe and decent home…we will together, make a real difference in revitalizing our communities."

Bart Harvey, Chairman and CEO of The Enterprise Foundation - "Despair does not move people or motivate them to get involved. Results do. Enterprise is proud to partner with HUD on a project that will demonstrate results and the commitments that make them happen."

Michael Rubinger, President and CEO of Local Initiatives Support Corporation - "Across the country, in hard-pressed urban and rural neighborhoods, every day is Raise The Roof Day for thousands of local community developers…national Raise The Roof Day will underscore not only the tremendous need for quality affordable housing, but also the tremendous potential that exists in these communities."

Content Archived: January 20, 2009

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