Editor's note: This story is part of Southwest Michigan Second Wave's On the Ground Battle Creek series.
 
BATTLE CREEK MI — The first new home builds in 15 years by Battle Creek Area Habitat for Humanity (BCAHH) will increase affordable housing options and multiply opportunities to build generational wealth, says Mike King, Executive Director of BCAHH.
 
These new builds began in 2023 following a 15-year hiatus that found the organization focusing on housing rehab efforts.
 
“The shift to rehabs happened because there were so many vacant houses and it just didn’t seem to be right to build a new house when we had vacant houses that were so cheap to buy. Some people would donate these properties. Housing stock at the time was very, very cheap,” King says.
 
This is no longer the case, he says.
 
“We used to be able to purchase an affordable house to rehab for under $5,000. These same houses now cost about $30,000.”
 
John GrapBattle Creek Area Habitat for Humanity is building this house on Woodlawn Avenue near LaMora Park Elementary.The reason is a demand that pushed prices higher and a scarcity of housing stock. BCAHH has a waiting list of five potential homebuyers and plans to build close to four homes per year.
 
“A lot of houses are outdated and are torn down and that reduced the amount of housing stock,” King says. “Housing prices have gone up considerably because investors are willing to pay $30,000. They know if they invest a little bit or redo a whole house they can sell it at a profit.”
 
Since the establishment of the local Habitat for Humanity in 1989 there have been about 120 homes that have been rehabbed or were new builds, the latter being a small part of that total number.
 
Thirteen of these new builds were along the Helen Montgomery Avenue area of the city and another six were along West Jackson Street.
 
The most recent new builds include three fronting Lamora Park and one on North McKinley Avenue. King says at least six homes will be built in Lamora.
 
A completed build has already been sold, three more are in the process of being built, and construction is expected to start next year on two more.
 
John GrapRuss Baker of R.A. Baker Plumbing and his backhoe move soil on a Habitat for Humanity construction site near LaMora Park Elementary.The McKinley lot was purchased from the Calhoun County Land Bank Authority (CCLBA). Another lot was purchased through a County Tax Foreclosure Auction and was converted to two lots.
 
“We saw a big lot next to it which was the site of a church that had burned down and they were willing to sell the whole lot and the parking lot along with it, and that ended up becoming four building lots,” King says. “There are three houses now on there and we’ll build another one nearby.”
 
When deciding where to construct new homes, King says he seeks input from Helen Guzzo, Community Development Manager for the City of Battle Creek. Affordable land and access to public transportation are among the factors taken into consideration.
 
John GrapMike King, executive director of the Battle Creek Area Habitat for Humanity, points out the efficiency rating of a window at a house under construction.BCAHH’s work is funded by community partners, including the W, K. Kellogg Foundation, the Miller Foundation, and the City of Battle Creek. Revenues from the Habitat ReStore on North Avenue are also used to purchase lots and build homes.
 
The City has partnered with Habitat for Humanity to fund two of the new builds at 25 North Woodlawn Avenue and 273 West Spaulding Avenue with Habitat serving as a Community Development Housing Organization with funding from the federal HOME Investment Partnership program, Guzzo says.
 
“The City is providing each home a development subsidy of $130,000 along with up to $13,000 of downpayment assistance for the eventual purchasers,” she says. “The purchasers are low-income families who won't otherwise be able to afford a new home, the housing will provide a stable place for their children to grow up and flourish.  Habitat works with the families to prepare them for homeownership.”
 
John GrapBattle Creek Area Habitat for Humanity is building this house on Woodlawn Avenue very near to LaMora Park Elementary.“Many banks are giving us Community Reinvestment Act funding. That Act, King says, was put into place to counter Redlining, so banks are required to contribute funding into areas where low-income people are serviced.”
 
Credit unions are another funding source as are individual donors and organizations.
 
In 2022, Habitat for Humanity International along with 84 U.S. Habitat affiliate organizations, that did not include BCAHH, received $436 million in unrestricted giving from American author and philanthropist MacKenzie Scott. She is the ex-wife of Amazon founder Jeff Bezos.
 
New versus rehab
 
The new builds are 1,200 square feet with three bedrooms and 1 ½ bathrooms. They do not have basements or garages which decreases construction costs by more than $30,000. These homes take anywhere between four to six months to complete and are the standard bearers for energy efficiency.
 
John GrapInside of a house on Woodlawn Avenue currently under construction by the Battle Creek Area Habitat for HumanityAs an example of this, the floor systems use foam instead of concrete because it provides higher levels of insulation, King says.
 
Wooden flooring is laid on top of the foam. The walls also are insulated with foam.
 
“It’s almost like building an igloo cooler,” King says. “Years ago Habitat was doing a lot of energy efficiency above the code, but now the code has caught up with Habitat. This saves money on heating and cooling bills for our families.”
 
“These are supposed to be affordable structures for families that couldn’t afford normal bank loans,” King says. “The goal is to do as many housing units as we can in a way that makes them affordable for people.”
 
John GrapRuss Baker of R.A. Baker Plumbing, left, talks with Battle Creek Area Habitat for Humanity’s executive director Mike King on a construction site.Each house costs about $150,000 to build. About $110,000 of this total covers the materials and contractors and the remainder is used for construction supervision and administrative costs. The houses appraise at $165,000 so Habitat isn’t putting in more than the appraisal amount.
 
When rehab was the focus for BCAHH, the organization purchased the majority of its rehab homes from the CCLBA.  
 
“We’d take the worst house on the block and gutted and rebuild it and would end up with the best house on the block,” King says. 

But the cost of this rehab work was becoming comparable to a new build and if an existing house had crooked walls or sloping floors, those are things that can’t be fixed, he says.
 
John GrapBattle Creek Area Habitat for Humanity is currently building three houses close to LaMora Park Elementary.“With the time it takes to do a rehab, you’re still paying construction supervisors and buying all of the materials, so it became almost a wash,” King says.
 
Families purchasing the homes are required to complete 400 hours of sweat equity and individuals must put in 200 hours of sweat equity. There are options to have volunteers recruited by the buyers contribute to those hours.
 
Potential homebuyers apply on Habitat’s website and then meet with financial counselors with Habitat Michigan.
 
John GrapOutdoor storage sheds which will belong to three houses currently under construction near LaMora Park Elementary.“We require a credit score of 640 because families do take out a loan from a bank,” King says. “After they’re deemed ready for a mortgage and Habitat Michigan deems them ready for the Homebuyer program, it could be anywhere from a month to two years to get them through the process. Then we present them to our board for approval.”
 
Despite this due diligence, about 6 percent of these homes have ultimately gone into foreclosure.
 
“It’s unfortunate, but that’s kind of how things happen sometimes,” King says, adding that it doesn’t diminish the work BCAHH is doing to address an ever-increasing affordable housing crisis.
 
“I feel good about what we’re doing. It’s pretty exciting. For our families, it’s their house, their project, and their own stability that they’re building. We’re just helping them along the way.”