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Bank aims to woo landlords with new $5 million Section 8 housing loan program

BayFirst takes a new tact in the ongoing affordable housing crisis.

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  • | 5:00 p.m. September 15, 2023
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The first phase of Sarasota Housing Authority's Lofts on Lemon offers 128 units are priced at workforce and affordable housing levels, all at 100% or less of AMI.
The first phase of Sarasota Housing Authority's Lofts on Lemon offers 128 units are priced at workforce and affordable housing levels, all at 100% or less of AMI.
Photo by Andrew Warfield
  • Manatee-Sarasota
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A new loan program has been unveiled at St. Petersburg-based BayFirst National Bank with the intention of getting landlords to build more Section 8 housing. 

The program provides 80% financing on a 30-year amortization, meaning landlords will have a set amount to pay each month. BayFirst, a $1.08 billion-asset bank with locations in Hillsborough, Pinellas, Manatee and Sarasota counties, has pledged to get the program started with a $5 million investment. Section 8 is a federal government program to assist low-income families, elderly and disabled afford housing. 

Thomas Quale, market president and chief lending officer at BayFirst, says it’s likely the bank will add another $5 million eventually. The program was unveiled to a crowd of roughly 100 people at the PopStroke golf venue in the The East District at UTC in Sarasota Sept. 14. 

The new loan program, a first for BayFirst Quale says, is available for Sarasota and Manatee counties. If it is successful then the bank plans to expand it to Pinellas and Hillsborough counties, which seems likely since Quale says they’ve already gotten a great response from interested landlords. While declining to provide specifics, he says there have been numerous discussions with different interested parties since the program was revealed. 

"(We) generated a lot of activity from that one event," he says, adding news articles have also been helpful. The bank's marketing department has also been using social media to boost interest.  

The genesis of the loan program goes back to a meeting BayFirst officials had with Sarasota Housing Authority executives earlier this year. They chatted about what could be done about the affordable housing crisis in the city and surrounding area. 

That’s when BayFirst learned about the waitlist. 

In 2021 the waitlist to receive a Section 8 voucher opened for two weeks. In that time, SHA got 8,000 applications but could only take 1,500. SHA Executive Director William Russell wasn’t sure what the official number is now but says only about 10-50 applicants get pulled off of the list a month once they’ve received a voucher. The vouchers allow participants to find housing within the Section 8 requirement. The participants pay the difference between the actual rent charged by the landlord and the amount subsidized by the program. 

“There’s not enough housing to fill that waiting list,” Quale says. That’s why the program focuses on landlords, despite it not being a traditional financing program banks utilize. 

“A lot of other banks don’t really like to do this type of financing because the tenant is not necessarily in place. We know there’s demand, so we’ll do that without a formal lease signed by a tenant.” 

The maximum loan amount allotted through the program is $350,000. 

SHA provides access to two voucher programs. The second, referred to as the project-based voucher program, helps residents with rent while residing in a specific unit covered by a long-term housing assistance payment contract. But the SHA doesn't manage the waiting lists for this program. Instead, the property managers of the specific units oversee it. The properties included in Sarasota in this program are: 

  • Janie’s Garden
  • King Stone Townhomes
  • Diamond Oaks Apartments
  • Lofts on Lemon
  • Amaryllis Park

Even when given a voucher, it’s not guaranteed a family or individual will find a home. Russell says about 20% don’t find a place to live. "We need more landlords,” Russell says. 

William Russell says not much has changed since he first arrived in 2005 in terms of being in an affordable housing crisis.
Courtesy photo

“If (the BayFirst program) increases our inventory at all, that would be amazing,” he adds “Any new landlords offering additional units to the program, that just means more families housed.”

The affordable housing crisis, says Russell, hasn’t changed much since he got to town in 2005. He remembers a county survey back then that revealed affordable housing as residents’ biggest concern.

“When I got here it was a bad situation, probably not as bad as it is now, but it was to the point where residents realized that a lot of the workforce couldn’t afford to live here,” he says. “There were help wanted signs everywhere. It was starting to affect the whole economy, like it is now.”


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