A Boise housing agency is using a little bit of cash and a line of credit from a sympathetic lender to start buying and remodeling homes for low- and middle-income residents.

Neighborhood Housing Services is starting small, with one house in North Boise and one on the Depot Bench. But it hopes to use the profits from selling the homes to expand, helping more would-be property owners establish a home, improve their credit and strengthen neighborhoods.

Many Boiseans know Neighborhood Housing Services as the host of annual events like Rake Up Boise and Paint The Town. The agency also works with residents to find affordable housing and avoid foreclosure. The nonprofit turns 30 this year.

Its new program will focus on rehabbing houses in older, established neighborhoods. NHS will sell them to qualifying low- to moderate-income families. The selling price will be under $200,000, said CEO Joe Swenson.

He hopes to make a profit of 10 percent to channel back into NHS programs.

“These aren’t remodels with granite countertops,” he said, but the homes will be low maintenance, good investments for their new owners.

NHS is pouring between $40,000 and $50,000 into each project. That includes new plumbing, roofing, wiring, heat, air and more. There’s also attention to detail like lead abatement and xeriscaping, to cut down on water costs.

“This adds to our costs, but it makes for a better environment and more stable neighborhoods,” said Swenson.

The goal is to make the houses maintenance-free for their owners for at least 10 years, said Jason Baumgartner, director of marketing.

Owners can build their financial stability if they don’t have to pay for unanticipated costs like replacing a broken water heater.

“The point is, we’re not doing enough for limited-income families who get squeezed out of the market,” said Swenson. “Low interest rates are one thing, but they don’t mean a lot if there’s no affordable housing stock and it’s too hard for people to get credit.”

STARTING SMALL AND BUILDING

NHS is renovating a house on Breneman Street in North Boise that sat vacant and gutted for more than a year. A house in the Depot Bench neighborhood is purchased and ready for remodeling. The agency is also in the market for a third house.

NHS is paying for the project with $325,000 it set aside from a property sale and a $500,000 line of credit from Community Housing Capital in Georgia. The agency has built a relationship with a contractor who offers fixed bids and discounts.

In the future, NHS may invite the community to donate to the program, or develop a program through which donors could share in the profits from the sale.

Eventually, said Swenson, the agency would like to be working on five houses at a time. It’s focusing on the Depot Bench, North End, the 30th Street Corridor and the Vista and Broadway neighborhoods that are close to schools, transportation and not too far from Downtown.

Recent improvements such as the new water park in the 30th Street neighborhood has made that area especially attractive, said Swenson. That means more competition to find suitable properties.

It has been a challenge to find decent houses for under $150,000, said Swenson, even though as a nonprofit NHS gets a first look at bank-owned properties. The organization faces stiff competition from flippers who want to buy and sell houses fast. NHS take its time to find homes it thinks will hold up well after remodeling.

“We look at about 10 houses before we make a bid,” said Swenson.

The first remodeled house on Breneman Street will go on the market in mid-October. NHS has in-house lenders — or potential buyers can work with their own banks.

A WIDER VIEW

With its new program, NHS joins other agencies doing similar work to bring old houses back to life and help families build their resources.

Idaho Housing and Finance Association administers a variety of federal programs to buy and restore foreclosed properties, which are either rented or sold to low- and middle-income Idahoans. IHFA said it has helped about 300 families move into rehabbed homes throughout Idaho in the past three years.

Nonprofit Mercy Housing Northwest-Idaho, which, like NHS is celebrating a 30th anniversary, has bought and rehabbed 34 foreclosed homes throughout Idaho, but mostly in Canyon County. Twenty-eight have sold so far to low- and moderate-income families. Another sale should be final in a few days, said Bud Comther, regional project and construction manager.

“Programs like these help families. They also stabilize property values for neighbors and hire local workers. From every angle, it’s a good deal,” said Comther.

Anna Webb: 377-6431