Rural organizations play an important role in combating the effects of the recession by working to provide affordable housing for an increased number of people. Due to high need, many rural organizations without prior housing development experience may now be interested in exploring the development process.

This manual is intended to serve as a starting point for those groups by providing a basic overview of the housing development process and the understanding necessary to move on to more detailed and more complete guides to housing development. This guide does not cover every step of the development process; instead it highlights those parts that HAC considers especially critical to an overall comprehension of housing development. This manual should not be used as an organization’s only guide to developing affordable housing. 

Housing development can mean many different things. It can mean new construction or rehabilitation of existing structures. It can involve development of single-family homes or multifamily housing, rental units or homeownership projects. Yet all types of affordable housing development share the same basic process. Whether a proposed project is simple or complex, failure to understand that process or to successfully complete the requisite development and housing counseling steps can seriously jeopardize project success. This guide is specifically geared to development of affordable housing in rural areas, since rural housing developers face unique obstacles, such as fewer housing development professionals from which to choose, fewer commercial banks to approach for funding, and limited public water and sewer infrastructure. 

However, the rural development organization also enjoys certain benefits, including U.S. Department of Agriculture (USDA) Rural Housing Service (RHS) programs that provide funding only to projects in rural areas.1 Although this manual does not include information on the formation and structure of the development organization itself, readers should be aware that many funding sources have eligibility requirements for the organization. For instance, some programs require that applicants have 501 c(3) status; others ask that a developer have a certain number of community representatives on its board of directors. HAC developed A Nonprofit Capacity Self-Assessment Workbook for Rural Community-Based Housing Organizations as a tool that nonprofit groups can use to examine their structure as an organization. 

The potential rural housing developer must understand that although successful affordable housing development is certainly achievable, it requires careful planning and persistence. Moreover, since housing development today is expensive, it must usually be done with borrowed funds. Housing developers must create well-thought-out plans and maintain a solid commitment to accomplishing attainable goals if they expect to secure those funds. Rural housing development is a rewarding activity that changes people and communities for the better.