HOA’s 2nd mortgage has created a growing, self-sustaining, permanent revolving fund. The 2nd mortgage captures the value initially created through development and a proportionate share of the increase in value over time. This pool of assets represents “social” equity that would otherwise accrue to developers. Instead, through the HOA mortgage, the equity is preserved and grows as a revolving fund which is essential to providing affordable housing in the future. HOA, a non-profit corporation operating under a Declaration of Trust, holds this revolving fund of equity solely for the purpose of providing affordable housing in perpetuity.
The growth in HOA’s assets demonstrates the importance of preserving social equity in a revolving fund dedicated to providing affordable housing. HOA’s equity now exceeds $50 million. HOA’s funding partners – the federal, provincial and municipal governments – have provided an additional $8.7 million to use as additional down payment support to families that need more than the basic 2nd mortgage help.
The chart below shows the growth in HOA’s permanent revolving fund since its inception in 1998.
HOA’s permanent revolving fund is an important repository of social equity structured to assist low and moderate income families in the future. Its beneficiaries already number in the thousands and will continue to increase in number and location.
