The Front Porch Initiative is dedicated to addressing housing quality and affordability in persistently impoverished rural communities. We believe that everyone, rich and poor, deserves a “shelter for the soul.” Rural Studio has spent decades designing and building homes for our rural neighbors that are efficient, resilient, and healthy, and now, we want to expand rural homeownership outside of our service area in West Alabama.

Rural homeowners, especially those in persistently impoverished communities, often struggle to qualify for a mortgage. We can meet this challenge by re-thinking housing affordability, so we’ve asked the question: what can an efficient, resilient, and healthy home afford the owner, lender, and insurer?

Traditionally, housing affordability is addressed primarily by reductions in the cost of building a home, through using less expensive materials or other means of value engineering. Our approach makes housing more affordable not by simply reducing initial construction costs, but instead by also increasing overall building performance. Energy performance, durability, and resilience, and a focus on wellness can better enable a homeowner to pay their mortgage month after month, and year after year—and at no increase in monthly cost to the homeowner.

Simply put, for every $1 a homeowner can afford to increase their monthly mortgage payment, they can finance an additional $200 of building construction costs. So, if by increasing energy efficiency we are able to reduce a homeowner’s monthly energy bill by just $25 per month, we can shift that same $25 to their monthly mortgage payment. Due to the long-term financing of this investment, the homeowner can now afford to finance an additional $5000 in energy-efficient construction with no increase in their total monthly home-related bills.

With the understanding that homeownership is the foundation of financial wealth building, we connect the “first costs” of home procurement (the overall cost of the mortgage) to the “second costs” of homeownership (monthly mortgage, utility, and insurance bills), creating a new paradigm of how a lender might consider the mortgage eligibility of a homeowner. By changing this mortgage paradigm, homes can afford rural homeowners the opportunity for safe, reliable, and efficient shelter. Moreover, higher-quality, higher-performance homes reduce risk to both the lender and the insurer.