From the Forum – Anyone have experience with IZU buying? I shouldn’t get my hopes up…right?

Inclusionary Zoning Unit-Experience/Advice?:

“I applied for the housing lottery a while back and recently got a notification that I was one of the selectees chosen to purchase a unit in a new condo building. I’m not sure how many other people got the same notification, but I was obviously pretty excited that I might be able to own a condo for an affordable price. I have been told that other selectees and I will need to submit letters of interest, approval letters from lenders, and documents to verify our lower-income status.

My question is…what are the odds and how exactly does DCHD choose the individual who gets to purchase and inhabit the unit? I am confident in my ability to get a mortgage approval-but I haven’t lived in the city very long. My tax statements still use a previous address, in fact.

Anyone have experience with IZU buying? I shouldn’t get my hopes up…right?”

You can see all forum topics and add your own here. If you are having trouble uploading your question to the forum please try clearing your cache. If it still doesn’t work please email me at princeofpetworth(at)gmail

10 Comment

  • Not sure what textdoc means by “getting financing is easier said than done” — that is certainly true for folks at lower incomes who are eligible for these units, so you’re ahead of the game if you have good credit. From the developer’s perspective, by the time the building is ready, the IZ units have been financed and built as part of the overall project, and they’re eager for the units to sold asap to a qualified buyer to avoid further loss of revenue. Historically, DCHD is not performing in terms of producing qualified buyers who can actually get to the closing table, so these units then sit empty– which actually hurts the developer’s profit. So if you really have your s**t together and can be aggressive about putting yourself forward to the broker, owner, AND DHCD, you may have a better shot than you think. If there is a broker for the building, definitely get in touch with them directly asap as their interests are also aligned with yours. Good luck!

    • My impression was that banks didn’t want to finance IZUs (even if the prospective buyers had good credit, etc.), because the banks didn’t feel that they could recoup their investment if the buyer defaulted, because the resale price of the units is restricted. (I think that was the reasoning — I didn’t re-read the articles.) But from what you’re saying, maybe that has changed, or at least is in the process of changing.

      • I have the same impression of the situation at textdoc. It has nothing to do with finding qualified buyers but banks reluctance to finance the loans because of the stipulations attached to the units.

        If the OP already has a bank lined up willing to finance the IZU then they are definitely ahead of the game; otherwise, it’s possible that they could run into some difficulties.

        • Ah, OK. That may be a factor, though there are definitely financial institutions here in DC that support lower income buyers (CityFirst, for example). I would dispute that “it has nothing to do with finding qualified buyers” because, as a developer, I know it does.

          • I guess if no qualified buyers can be found, that’s a problem too… but my impression from what I’d read was that banks were reluctant to finance such units because of the restrictions, not because of buyer qualifications.

  • I thought you said UZI

  • as someone who owns an ADU (which is what the IZUs used to be called, at least I think) I would recommend going with a broker who is familiar with financing for these types of units. I worked with Manna Mortgage in NE dc and I would definitely recommend them. I wish I had advice for your on the process but I wasn’t the original owner of my unit so I didn’t go through the lottery. it was the deal of a lifetime, so good luck!

  • I am a broker that represents several developers specifically in the sale of inclusionary zoning units and affordable dwelling units (two different things). If you were chosen as part of the lottery process, get all of your documentation to us (or whomever is handling that sale) as soon as possible (take IZ class, get pre-approval from a lender that can finance the units…we have two available, get your income certified) then you may have a good shot. I don’t know about anybody else who is handling IZ sales, but we are high touch…e-mailing and calling everybody on our list several times…and many people just do not complete the process.

  • I actually purchased a similar unit a couple of years ago. Getting all the paperwork and approvals together is a lot of and a bit of a pain in the ass, but in the end it was very much worth it for me. Being picked in the lottery means that you should get the unit, as long as you are able to prove your income is what you said it was on the application, you will need pre-approval for a loan as proof that you will be able to pay for the unit, and you will have to submit more paperwork to DC Dept of Housing and Community Development and HUD, and the mortgage company. If you get all the approvals, you should be good to go.

    I worked with the preferred lender for the building I moved into, which was Lola Pol at REMN. She was great and helped me navigate the process, which is sometimes confusing. She said that she really enjoyed working with me because I always got any documentation that they needed in quickly. Maybe it was because I felt so lucky to be able to pay such a great price for a nice unit in EXACTLY the neighborhood I wanted, but I was highly motivated and didn’t want to miss out on an opportunity for something as stupid as not getting paperwork in on time.

    Lola did mention that people from the original lottery dropped out of the process and apparently backups did as well. Some of them did not meet the requirements, others just gave up, but eventually some of the unites were posted on real estate websites to get them sold.

    Just stick with it and get documentation in as quickly as you can and I am sure you will be fine. Good luck, I hope you get the unit you want!

Comments are closed.