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Cisneros praises affordable houses

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CENTERVILLE — Middle-income Americans are demanding more affordable housing located closer to work and their city's center, said Henry Cisneros, former secretary of the U.S. Department of Housing and Urban Development.

"A great metro region has to have housing of all income types," said Cisneros, who was HUD secretary from 1993-97. He spoke Wednesday at a grand opening of Pineae Gardens, a housing development in which Cisneros' company has invested.

The development promises to be energy efficient, in the center of town, close to freeway access and affordable.

Cisneros' company, CityView, invests in the "new urbanism" architectural concept of small, affordable, "green" houses in walkable neighborhoods. CityView is managing an $800 million fund that started in 2003 and has built about 7,000 homes so far, including the condos, town homes and stand-alone houses in Pineae Gardens, built by Taylorsville contractor Gold Medallion.

The 227 condos in Pineae Gardens, named after a nursery formerly located on the property at 650 N. Main, sell for $169,000 and are about 1,400 square feet. Single-family homes cost up to $300,000. The houses meet energy-efficient standards of Rocky Mountain Power's Energy Star program, and owners are expecting to save 30-60 percent on energy bills.

Patrick Newman moved into his condo with his wife and 2-year-old daughter at the end of May, after years of apartment renting. He enjoys the cheap energy bills. His new home also is on the bus line that goes to his work at the University of Utah.

"It's very daunting to try to transition as a renter to homeowner, especially in this economy," he said. "It's difficult to get loans, and the price is out of reach."

Cisneros said home ownership is increasingly becoming out of reach, and with $4 a gallon gas, people are fed up with commuting.

"The backbone of this country is the middle class," he said. "The way people become middle class is homeownership."

To qualify for investment by CityView, Gold Medallion General Contractor Kristen Nilssen had to prove housing was attainable for people with 80-150 percent of the area's median income. She had to prove she had prior experience in making such housing work. The houses had to be for sale, and they had to be close to amenities and public transit. As houses sell, Gold Medallion gives money back to CityView.

In the first quarter of 2008, the median Davis County home sold for $259,000. In 2006, the most recent year for which income data are available from the Utah Tax Commission, the median income of married couples filing jointly in Davis County was $65,800, said Kelly Matthews, a Wells Fargo economist.

Cisneros doesn't see Pineae Gardens and other low-housing initiatives as a means of artificially deflating prices. He said the houses are located in high-density areas, and they tend to be smaller than most suburban houses, which makes the price of land per unit cheap.

Centerville City had to change zoning ordinances to allow the development.

E-mail: lhancock@desnews.com