A housing program hosted by one of the state’s largest nonprofit organizations recently wrapped up work on its 102nd home built on the Central Kenai Peninsula. The program offers discounted real estate prices for participants, who spend two years helping build their home. There’s hope the program could relieve some of the pressure in Alaska’s tight housing market.
Driving down Derk’s Lake Road near Mackey Lake, the row of colorful houses looks like it’s always been there: peppermint green, brick red, sky blue. The group of nine homes is collectively called the Tatum Development by the Rural Alaska Community Action Program, or RurAL CAP.
In one of the garages, a banner celebrates the program’s 100th home built.
“It's a big accomplishment,” said RurAL CAP’s Rural Housing Director Mi’shell French. “It's really a testament to how successful the program is and what a huge difference it can make for the families that participate, as well as the communities that they build in.”
French also runs the RurAL CAP’s mutual self-help program, which is behind the new homes. The program offers a unique opportunity for participants to save money on a new home by helping build it – something the organization calls “sweat equity.”
“The sweat equity is the work that the families put into the houses,” she said. “So rather than hiring a general contractor who takes 20% off the top, those families are doing that 20% themselves.”
Participants are responsible for things like framing, insulation, windows, doors, trim and finishes. A subcontractor handles the more involved work, like plumbing, electrical and heating.
Participants must put in 65% of the overall labor and at least 35 hours of work per week. They work together to build each others’ homes, and no one moves in until all the houses are finished. The most recent construction cycle lasted about 16 months.
Speaking from a newly finished kitchen, French says the four-bedroom house was built for about $302,000. It was appraised for about $420,000. That difference is the sweat equity.
Whitney Cavazos and her husband built their home in the last round of construction. She says the decision ended up being a no-brainer.
“We would not be able to afford a house brand new with all that it has and floor heating on our salary – like this nice,” she said. “Just, it wouldn't happen. The housing market is just insane now. I moved in here in 2020 and it was even better then, and just since then, it's just gone way up.”
Mariah Medley, another participant, heard about the program through a friend after struggling to find a pet-friendly apartment for her and her dog.
“I had another friend that had actually done this program,” she said. “After seeing her house, I was like, OK, I was like, ‘You know what? I’m going to bite the bullet. I’m going to give away two years of my life and I’m going to do this.’ And I’m actually pretty happy I did.”
Both Medley and Cavasos said the build was more work than they’d initially expected. They each started 18 months ago with framing. The final touch? Handles in the kitchen.
French, the rural housing director, says the program has a good track record with occupancy rates – she estimates 95% of families who built their home through the RurAL CAP program since it started in 2007 still live in those homes.
And even as they celebrate more than 100 new homes built, she says the organization’s work on the central peninsula is only the beginning.
“It’s a small step to a larger issue and we’re very excited to be able to be part of the solution,” she said. “Of course, we’re not going to be able to solve everything with this program, but it’s a start.”
RurAL CAP is looking to start work on 10 units in Seward this summer and are making progress with the Kodiak Island Housing Authority for a mutual self-help build program there. And French says Ketchikan and Valdez have expressed interest, too.
