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Commissioner Mathews outlines plan to sell 79 HUD homes and use proceeds for a down-payment endowment
Summary
At a Salem Housing Authority meeting, Commissioner Mathews floated selling 79 HUD-owned scattered-site units for roughly $25 million and placing proceeds in an endowment to fund perpetual down-payment assistance; Housing Authority Director Nicole Yates said HUD approval and Section 18 processes remain required.
Commissioner Mathews on Monday described an alternative to the current scattered-site sale that would sell all 79 HUD-owned units at market value and place the proceeds in a permanent endowment to fund annual down-payment assistance.
Mathews said the portfolio is worth about $25 million and that the endowment would operate on interest, not principal. "We would take that $25 million and we would put it in an endowment fund... and on average draft around 4% interest on. So that's about $1 million worth of interest that we would gain on that $25 million every year," Mathews said, adding that assistance awards would be tiered "at a maximum value of $100,000 per down-payment assistance loan all the way down to as low as $25,000."
Why it matters: Mathews framed the idea as a way to convert one-time sales into a perpetual funding source that could support many households over time, instead of a deep, one-time discount transfer of units to a small number of buyers.
Housing Authority Director Nicole Yates told commissioners that HUD rules constrain what the authority can do with HUD-owned properties and that the agency has been working the Section 18 disposition process since 2024. "This is pretty standard Section 18... they have a deed restriction by Housing and Urban Development and so we have to meet a certain threshold through our special application center for us to move forward with the project," Yates said, warning that any endowment approach "may not be something that's going to be approved by them." She also said about 33 homes were identified as potential Habitat for Humanity candidates and that staff planned to bring forward a proposal for the first eight homes this year.
Public comment at the start of the meeting included two speakers who urged caution about using public dollars for homeownership subsidies. "I'm opposed to using public funds for what in practice would amount to a bailout of the local real estate market," one commenter said, urging attention to wages and broader affordability measures.
Outcome and next steps: Commissioners treated Mathews's proposal as an information item; Mathews said he would likely bring a formal motion after staff returns a signed contract with Habitat for Humanity and after further HUD vetting. No formal sale or alternative plan was approved Monday.
Context: Under the existing disposition plan discussed by staff, a portion of the identified homes would be disposed of to listed nonprofit partners under HUD rules; Mathews's endowment idea would require HUD concurrence and additional staff capacity to implement if it proceeds.
