Kaulana and Vonne “Hana” Noa enjoy playing with their children in the backyard of their new home in Kahului. “This is where our kids will grow up, said Kaulana. It feels good to know that.”
Kaulana Noa is a recruit with the Maui Police Department. His wife Vonne, also called “Hana” by her friends, helps people get medical insurance through the QUEST program at Kaiser. They have 4 children, ages 11 years to 5 months, and seven years ago they dreamed big and embarked on an ambitious plan to move from renting, to owning at Hawaiian Homes, to owning a Nā Hale O Maui (NHOM) house, and then moving to a market priced home.
Today, they are the first NHOM family to live that dream by moving from a NHOM home to a market price home. This was a key goal of the community land trust (CLT) since it began.
“This is where our kids will grow up,” said Kaulana. “It feels good to know that.”
The Community Land Trust movement began with what has been described as “a big idea in a small city.” That city was Burlington, Vermont, and the year was 1984. A young Burlington city council member named Bernie Sanders made a motion to fund this new land trust organization with a $200,000 grant to get the group on it’s feet. He supported their idea of homes being made affordable through a long-term lease that removed the cost of land from the price of the home. The ownership of the land stayed with the trust, while the home itself was leased to the “home owners” who developed equity in the home over time.
One goal of the Burlington Community Land Trust (now the Champlain Housing Trust) was to keep the cost of a CLT home to a level that allowed people to save money for a down payment in order to move up to a market priced home at a later date. A 2009 study commissioned by the trust has shown that since it was founded 67.4 percent of former CLT homeowners bought market-priced homes within 6 months of leaving the community land trust. This upwards movement also opened up CLT homes for new participants.
Fast forward to 2006, a group of housing advocates on Maui decide to replicate the Burlington model. With little more than the Vermont success story as their backdrop the group was able to receive a $50,000 grant from the County of Maui with the support of then Mayor Charmaine Tavares. Private funding was also raised, including $15,000 from the Realtors Association of Maui. NHOM began looking for public/private home building partnerships and was planning to build affordable land trust homes.
Their plan hit the 2008 recession. No one was lending and NHOM could not locate any private partners who wanted to build. To meet this unforeseen crisis NHOM changed its business plan and began to bring distressed abandoned homes out of foreclosure using funding they received from HUD’s Neighborhood Stabilization Program to purchase these homes, rehabilitate them and provide them to CLT home owners at a discounted price. To date NHOM has provided housing for 34 families.
With a planned 12-unit single-family home project in Lahaina, the building of their first NHOM home in Waikapu and their experience of working with CLT homeowners, NHOM expects to see more families like the Noa family be able to save for a down payment and move on to market price homes. Today, on Maui it is not uncommon to see people paying over 50 percent or more of their monthly income for housing costs. At NHOM that figure is no more than 35 percent.
For Hana and Kaulana it was all about starting small and building up. “Seven years ago we could never have afforded this home,” said Kaulana. They started small renting a two-bedroom, one bath Hawaiian Homes house from Hana’s uncle at $750-900 a month. When he passed, as his heirs they were able to acquire the home. Their mortgage was $1,100 per month.
Three years later they were introduced to NHOM by their lender at Home Street bank and were eventually selected and purchased a NHOM home. Today, the same size home would rent for more than the mortgage payment on the CLT home of just over $1,000 a month. They stayed four years as they gained job promotions and saved up enough money, along with a share of the appreciation to successfully purchase a 3-bedroom market price home with a mortgage payment of $3,000 a month.
Helping with the affordability of their NHOM home was the fact that the mortgage was less than 20% of the appraised value of the CLT home so the family did not have to pay private mortgage insurance. “That saved us $400 a month that could go into paying down bills and saving,” said Hana.
According to Kaulana moving into the NHOM home was easy, “They wanted you to succeed. Getting in and getting out, you never felt stuck.” Their family has grown and the house they now have is one they expect will last them for a long time.
Each time the Noa family has moved they were helped by the equity built in the home they had lived in. For example, the Resale Formula applied to their NHOM home provided shared equity when they sold that home back to NHOM. The CLT’s repurchase of the home helped the family to close escrow for their new home on time. NHOM also agreed to have the family remain in the home, at below market rent, until they were ready to move into their new market rate home. NHOM plans to renovate their old home before selling to another income- qualified household earning not more than 120 percent of the area median income, as determined by the County of Maui. That NHOM shared equity helped with their move up to a market price home.
“We wanted to help others as we moved to another home,” said Kaulana. When we moved out of Hawaiian Homes we were able to help another family and whenever they see us they always say how grateful they are for their home. It’s the same thing with Nā Hale O Maui. We are opening up the opportunity for another family to get a community land trust home just like we did. We like to think we are helping others.”
A Supplement of the Maui News, Real Estate Guide, Nā Hale O Maui SuccessStory – Friday, July 29, 2016 – Page T8