According to Builder Magazine, Habitat for Humanity International is the sixth-largest homebuilder in the United States[1]. The charitable organization, which works in partnership with low-income families to help them secure housing and strengthen neighborhoods, had 6,032 closings in 2010. Senior vice president of the U.S. and Canada Habitat for Humanity International divisions Larry Gluth describes the placement on the Builder 100 list as “a testament to what can be accomplished when people work together.” Habitat has been in the top 10 on that list since 2009. The organization’s Neighborhood Revitalization Initiative (NRI) is credited with the expansion in its number of home closings. Through NRI, Habitat and affiliates purchase and rehabilitate foreclosed properties to turn them into affordable housing. Also, the group helped 2,327 families with repairs to their homes in the past year.

In comparison, other homebuilders like Atlanta Beazer Homes, have dramatically decreased their number of closings. For example, in 2005 Beazer closed on 18,401 homes. In 2010, that number plummeted to 4,233. These “slow-downs by for-profit builders” contributed to Habitat’s climb into the top 10 over the past two years, despite the fact that Habitat laid off 10 percent of its staff in 2008 when contributions dropped by more than a million dollars[2]. Interestingly, according to the Atlanta, GA Habitat franchise – each affiliate of Habitat functions independently to raise money and build houses – calls for help have slowed in the past year. Larrie Del Martin, the Atlanta president, believes this is because of unemployment, since you cannot qualify for a Habitat house unless you have a job. Habitat buyers also must put 250 hours of “sweat equity” into building their own or someone else’s home or into working for the organization.

Notably, the average default rate on Habitat homes is two percent in Georgia, while 11. 5 percent of “conventional” mortgages in the state are currently in default. Habitat or sponsors hold the liens on the homes, and the average buyer earns about $40,000 a year and has a family of four.

What do you think that this high placement on the Top 100 list by Habitat for Humanity says about the housing market? Should more builders be holding their own notes?

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[1]http://www.habitat.org/newsroom/2011archive/05_10_2011_habitat_ranks_no._6_among_largest_homebuilders_in_us.aspx

[2] http://www.ajc.com/business/habitat-builds-more-houses-1141955.html