Housing advocates converge at Capitol, praise Bostar law that helps ward off investors

Yahoo

28-03-2025

Amanda Brewer, chief executive of Habitat for Humanity of Omaha introduces Habitat homeowner Autumn Austin during a "Homeownership Matters" rally at the State Capitol Thursday. (Courtesy of Habitat for Humanity)
LINCOLN — Habitat for Humanity of Omaha calls it the 'equity promise.'
It's new, and essentially a 'pay-it-forward' pact in which the nonprofit's homebuyer clients who receive downpayment and other assistance agree to certain resale restrictions designed to keep a house affordable for generations to come.
A problem Habitat saw in crafting the promise last year, however, was that property taxes owed by the homeowner could be thrown out of whack. Enter 2024 legislation pushed by State Sen. Eliot Bostar of Lincoln, which is now law and allows such sales-restricted houses a property tax break via a special method that 'stabilizes' values in recognition of limited marketability.
'It's a huge huge deal for the people it fits,' said Amanda Brewer, CEO of Omaha Habitat. 'This is ensuring that there are affordable places where people can own a home in Omaha for the next 50 years.'
Nebraska Habitat leaders see such potential in what the law can do to preserve homeownership accessibility for lower-income families that the organization honored Bostar this week with its 2025 Housing Champion Award.
Bostar received the award during two days of Habitat-led housing advocacy activities that wrapped up Thursday in Lincoln. He and a panel of state senators spoke Wednesday night to statewide Habitat affiliates and housing allies including Front Porch Investments and the Nebraska Housing Developers Association. Conversations with lawmakers continued the next day, capped by a 'Homeownership Matters' rally in the State Capitol Rotunda.
The rally drew about 75 housing advocates — some carrying signs that read, 'A house shouldn't cost anywhere near half your paycheck' — and several state lawmakers.
Among them was Speaker John Arch of La Vista, a health care consultant, who underscored the role homeownership has in building a social network that helps mental and physical health.
'We as a society, as a state, need to focus on helping people get into homes so that those roots can be put down, community can be built, and society, as a result, benefits from that,' said Arch.
He said the Legislature should be mindful of how to help especially first-time homebuyers, though Arch said he was not focused on pushing any specific housing-related bill over the finish line this session.
'We can do a number of things with tax incentives and making it easier for people to get in, but it's a challenge,' he said. 'Every year we need to be constantly searching for those new ideas.'
The Bostar-backed legislation last year, which began as Legislative Bill 1217 and became LB 1317, was multifaceted and included several elements advocates say should help preserve and create affordable housing opportunities in Nebraska.
Indeed, the part of the law that captured the most attention had to do with renter-occupied housing for low-income residents and adjusting property valuation methods for those Section 42 apartments.
That spotlight prompted Habitat to approach Bostar about pursuing the change related to its situation, representatives said. The provision applies to affiliates statewide, as well as NeighborWorks and other charitable organizations with a homeownership mission. The law took effect in July.
Habitat's Tracie McPherson said counterparts in other states worked several years to pass similar legislation, and she was grateful Nebraska lawmakers acted more quickly.
'We knew it was the right thing to do to keep affordable housing in our state,' she said.
Bostar said the law makes strides toward a couple of the Legislature's top priorities: property tax relief and preserving affordable housing.
McPherson said the changes should also help keep houses in local hands — and away from out-of-state investors that she said often turn them into costly rental property.
Lacey Studnicka, program director for Habitat, called the Bostar-backed law 'transformational' in supporting the nonprofit's equity promise and goal to preserve affordable homeownership for working families.
She said alarm bells had been going off as home prices spiked, putting houses out of the reach of nonprofits, such as Habitat, to sell to low-income residents. For context, she said, Habitat houses valued for tax purposes at $140,000 in 2019 in Omaha now are valued at $260,000.
The Habitat Omaha board approved its 'equity promise' approach at the start of 2024, which also gave the nonprofit the first right to buy back the house. Here's how that works:
The buyer agrees to covenants guaranteeing that another low-income family can purchase the home at an affordable price, if the homeowner chooses to sell or move. Habitat would get the first shot at buying the home back.
A seller still builds modest equity based on a formula and the time they stay in the house. In one scenario, the resale price for a buyer of a Habitat home whose mortgage is $200,000 (after downpayment and other assistance) and who owned the property for just under 3 years, would be $205,800.
The Bostar legislation then allows for a stabilization of property taxes, based on that first mortgage and a slight annual increase, said Studnicka. She said the homeowner must apply annually for the special assessment, similar to those seeking a homestead exemption.
The special valuation method is limited to properties first held by a nonprofit such as Habitat, NeighborWorks or a local community foundation that sells homes to individuals who are low income. The sales restrictions must run for at least 20 years and limit the sale of the property to another individual with a low income.
Bostar said he was grateful and encouraged by Habitat's reaction.
'Access to homeownership really represents access to the American dream,' he said. 'So much of a family's wealth and their ability to hand wealth down to their children to ensure they have a better life than their parents had rests with homeownership.'
Habitat for Humanity Nebraska affiliates have identified four 2025 legislative priorities:
Legislative Bill 531, introduced by State Sen. Kathleen Kauth of Omaha, would provide an exception to the requirement that buildings constructed with state funds comply with the 2018 International Energy Conservation Code.
LB 566, Sen. Dan Quick of Grand Island, eliminates expiration dates relating to an income tax credit for the purchase of certain residential property.
LB 622, Sen. Rob Dover of Norfolk, intends to make the Nebraska Affordable Housing Trust Fund more effective by getting funds to granting agencies quicker and making funds revolve as much as possible. It also proposes a documentary stamp increase for downpayment assistance.
LB 643, Sen. Jason Prokop of Lincoln, would remove the tax advantage investor-owned housing has over owner-occupied housing for companies that own more than 30 properties.