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Buying a home in Juneau could become more affordable for the average working stiff.

Nonprofit Housing First Inc. announced Wednesday that it received federal approval to offer its Home Opportunity Program (HOP) — in conjunction with Federal Housing Administration mortgages — to income-qualifying residents. The company says the secondary financing option will enable some renters living paycheck-to-paycheck to finally settle into their own home. Applications for this round of HOP loans will end Aug. 14.

HOP is a no-interest home-loan program for first-time homebuyers who have been pre-approved for a home loan and who make less than 80 percent of the annual median family income for their household size.

As a recent HOP homebuyer and former renter, Gabe Strong of Juneau, believes the program will help solve a couple of Juneau's major problems : younger people moving out and lack of affordable housing.

"You make enough money that you can rent a place and have enough food to eat, and that's about it," Strong said. "In my age group, I personally know probably three or four young families who have moved out of Juneau because they see no way for them to ever buy a home here."

With grant funds from Alaska Housing Finance Corp., HOP assists with a portion of the down payment and closing costs on single-family homes costing up to $303,050.

In some cases, additional funds may be provided to reduce the amount of the primary loan for the home, and up to $10,000 of the loan is forgivable after the homeowner has lived there for five years. In total, more than $400,000 is available in Juneau.

Housing First Executive Director Jennifer LaRoe said the program was developed to help curb Juneau's affordable housing problem.

"Being able to offer HOP as secondary financing with Federal Housing Administration mortgages will really increase the number of low-income Juneau residents we can help," she said. "Low-income residents may have a hard time qualifying for conventional loans."

Strong fully understands the frustrations that come with not qualifying for a home loan.

"Some people are kind of, what I would call, caught in the middle: They don't make enough money to actually afford a home, but they don't make little-enough money to qualify for some of the other programs," Strong said. "So they're making $50,000 to $60,000 a year, which sounds like a lot, but in Juneau it's not enough to buy a home."

Strong and his family of four have been full-time Juneau residents for about eight years. He owns his own video production company and takes care of his three children, ages 4, 3 and 11 months. His wife, Barb, manages at Heritage Coffee Co.

Before they bought their Arctic Circle home, the Strongs rented a two-bedroom apartment for $1,000 a month. They also paid utilities in an electric-heated apartment with vaulted ceilings, resulting in a monthly $370 electric bill.

"We had a good deal there, which is why we stayed there for so long," Strong said, "but because it was electric heat, in the winter it wasn't insulated really great, not nearly as well as this house is, and we were paying huge electric bills."

The unfortunate thing for the Strongs - and a lot of people - was that they were paying as much in rent as what a house payment would be.

"And our credit scores were really good, but that wasn't enough to get us a house, because they look at your income and basically say, 'You don't have enough income to afford a house,'" Strong said.

Now the Strongs pay $1,335 a month toward their mortgage and approximately $80 a month for electric. They closed on their three-bedroom, attached house on Oct. 21, 2008. In the end, the Strongs received $30,000 from HOP and $180,000 from a bank loan for their $225,000 home.

"We were actually at the upper end of the income qualifications, meaning we almost made too much money to qualify for HOP," Strong said. "And even with their help, we were barely able to purchase a home. We were able to because we came up with about $25,000 of our own with the help of our savings and last year's big dividend checks."

So even with HOP funding, it is still difficult to purchase a home in Juneau, but at least it makes home ownership more possible for some.

"And having a yard for the kids to play in instead of the parking lots ... is really great," Strong added. "Granted, this is not a program that is going to get you in an expensive ... place, (but) it is a great way to help people who can't quite afford a 'starter' home to get into one."

Because Strong truly believes in the HOP program, he even volunteered to be on the Housing First board, HOP and marketing committees. And he just finished constructing a new Web site for Housing First, which will be online once approved.

Executive Director LaRoe also hopes the program lives past its reconsideration this summer, when Alaska Housing Finance Corp. will release a Notice Of Funding Assistance.

"One issue with the program is that the administrative workload is greater than the amount allowed for reimbursement, so Housing First is currently subsidizing the program with our own funds," LaRoe said. "Being a small nonprofit with a very tight budget makes this a hardship on our agency. However, we believe it is too valuable a program to let slip away and not be offered in Juneau."

• Contact Neighbors editor Kim Andree at 523-2272 or kim.andree@juneauempire.com.