Stabilizing Neighborhoods Hit by Foreclosure Crisis
- Apr 10, 2009
The effects of widespread single-family home foreclosures on American neighborhoods have received much media attention. We’ve seen light-hearted footage of enterprising teenagers skateboarding in abandoned swimming pools—as well as disturbing images of block after block of empty houses falling into disrepair.
Lately the media has been focusing on new opportunities created as a result of these foreclosed homes.
Americans who were previously unable to afford certain properties are now snatching them up at auction prices. This is good news for neighborhoods on the brink, but others will require more assistance to be revitalized. Multifamily and single-family specialists will need to work together for this to happen.
Last summer Enterprise Community Partners Inc. and its partners worked with Congress to secure $3.92 billion for a Neighborhood Stabilization Program (NSP) in an effort to avert further destabilization. NSP is a recently developed federal program based upon the Community Development Block Grant (CDBG) and designed to provide localities with funds to reduce the harmful effects foreclosed and vacant properties have on neighborhoods.
Localities that received NSP allocations from the U.S. Department of Housing and Urban Development (HUD) were required to submit an action plan describing how they’d use NSP funds to confront the foreclosure crisis and stabilize communities.
In order to compile suggestions and best practices for communities hardest hit by the foreclosure crisis, Enterprise analyzed 87 of the 306 plans submitted, to see what the recipients of these NSP funds planned to do with their allocations.
Besides quantitative analysis, researchers looked for promising and innovative approaches in a number of areas including acquisition and discount strategies, disposition strategies, geographic targeting, green building and rehabilitation strategies, income targeting and long-term affordability, and leveraging NSP funds.
(Diana Mosher is the Editor-in-Chief of Multi-Housing News. She can be
reached at email@example.com)