A National Resource to Support Excellence in Community Action

Mutual Self-Help Housing Program

Last Revised: July 21, 2016 - Initial Posting: Jul 27, 2007

The Mutual Self-Help Housing Program expands affordable homeownership opportunities and also helps develop bonds of community and provides children with positive aspirations for their future.


USDA Rural Development’s Mutual Self-Help Housing Program makes homes affordable by enabling future homeowners to work on homes themselves.  With this investment in the home, or "sweat equity", each homeowner pays less for a home.  Each qualified applicant is required to complete 65% of the work to build their own home.

Technical Assistance Grants and Site Loans are provided to nonprofit and local government organizations, which supervise groups of 10 to 12 enrollees in the Self-Help Program. Members of each group help work on each other's homes, moving in only when all the homes are completed.  Self-Help Technical Assistance Grants are available to qualified non-profit organizations to provide technical assistance to low and very low-income families who are building homes in rural areas through the Mutual Self-Help Housing Program. These grant funds may be used to pay salaries, rent, and office expenses of the not-for-profit entity.

Once accepted into the Self-Help Housing Program, each individual enrollee generally applies for a Single-Family Housing Direct Home Loans.  These loans can have interest rates as low as 1% with a loan term as long as 38 years.  Eligible families can even borrow all closing costs.

Mortar and Muscle: Building Community and Assets through Self-Help Housing - Annie E. Casey FoundationMortar and Muscle: Building Community and Assets through Self-Help Housing – A report from the Annie E. Casey Foundation that looks at the experiences of families working to build their own homes through self-help housing projects across the United States. Primarily found in rural areas, self-help housing programs organize groups of families to work together, combining their efforts to build homes.  No family moves into their new home until all group members' homes are completed. In addition to helping families attain the dream of becoming homeowners, self-help housing projects strengthen communities and create informal, positive social networks.
Several publications from the Housing Assistance Council (HAC) offer in-depth information about the Self-Help Housing Program including:

  • Creating the Village (June 2005) – Research on how Self-Help Housing can provide significant economic and social benefits to low-income families that can be replicated across the United States.  The report’s summary indicates that mutual self-help housing:
    • Provides Very Low- and Low-Income Families with Homeownership Opportunities
    • Supports Local Nonprofit Organizations to Provide Integral Resources
    • Increase Economic Resources and Assets Among Low-Income Groups
    • Creates Social Capital and Civic Involvement
    • Develops Supportive Communities Where Children Can Flourish
  • Rural Voices (Fall 2003 issue) – Newsletter celebrating the 40th anniversary of the Self-Help Housing Program
Creating the Village - Housing Assistance Council          Rural Voices - Housing Assistance Council

Four regional organizations (shown below) are funded to provide technical and management assistance to local sponsoring organizations.  A number of Community Action Agencies serve as local sponsors in each region (note – please submit names of other CAAs that should be added to this listing).

The regional technical and management assistance providers offer guidance and a variety of printed materials such as the Project Directors Guide  and the items shown below from RCAC:Project Director Guide - Rural Community Assistance Corporation


Specific benefits of Self-Help Housing cited in HAC's Creating the Village include:

  • Expanding Homeownership
    • Creating affordable homeownership opportunities for more than 36,000 low-income rural residents.  The median income of current self-help borrowers is $22,048, about half of the national median income for all homeowners.  Self-help housing can reach very low-income households through a combination of cost-reducing program elements: no required cash downpayment, considerable savings in home construction costs due to the sweat equity labor, and affordable mortgages from USDA’s Rural Housing Service.  Home prices vary across the country, but self-help homes cost less than other homes.  The median loan for all self-help units constructed in 2000 (excluding California units) was $64,272, almost half of the median cost of a new unit in 2000.
    • Increasing minority homeownership: 58% of all USDA self-help residents are minorities while minorities make up less than one-fifth (18%) of the national rural population.
  • Building and Maintaining Assets: Mortgage payments build equity that families can draw upon to meet educational, repair, or other family needs.  Self-help units may cost less to purchase but they increase in value.  The median estimated housing value of self-help homes was $110,000 in 2000, which was 138 percent of the median value of all rural homes in 2000.
  • Earning “Sweat” Equity: Because of the labor they contribute, self-help families typically have a significant amount of initial equity as compared to other low-income families.  Self-help families move into their home with an average of $26,700 in initial home equity.  In comparison, the median amount of non-liquid assets (e.g. home equity) held by low-income families in general is less than $5,000.
  • Creating Community
    • Families surveyed reported a strong attachment to their neighborhoods and high levels of trust with their neighbors.  Over 90% continued to visit and rely on their neighbors even after their homes were completed.
    • Mutual self-help families are engaged and involved members of their communities.  One-third of all households surveyed were involved with the local PTA, almost half attended church regularly, and 70% were registered to vote.
  • Encouraging Children
    • The majority of children in the surveyed self-help families were engaged in activities, both in school and out of school.
    • Parents and children were overwhelmingly positive about their futures; the vast majority of these parents believed that their children would go on to college. More than half of these families had already taken steps toward that goal by taking college prep courses and talking about college.
    • Adult children who grew up in the surveyed mutual self-help communities had very high graduation rates; 90% of all adult self-help children graduated from high school and 55% went on to college.
    • Adult children of mutual self-help builders are also likely to be homeowners at an early age.  Almost 20% of the adult children of families surveyed were already homeowners, although their median age was only 24.

Florida Non-Profit Housing, AL, FL, GA, MS, NC, SC, TN, PR, VI

Little Dixie Community Action Agency, AR, KS, LA, MO, NE, ND, NM, OK, SD, TX, WY

NCALL Research, CT, DE, IL, IA, IN, KY, MA, MD, ME, MI, MN, NH, NJ, NY, OH, PA, RI, VA, VT, WV, WI

Rural Community Assistance Corporation, AK, AZ, CA, CO, HI, ID, MT, NV, OR, UT, WA, W. Pacific Territory