The Cities of Reno and Sparks will be taking part in the Department of Housing and Urban Development's (HUD) new Neighborhood Stabilization Program (NSP).
Nearly $1.7 million will be divided up among Reno, Sparks, and Washoe County. The funding is being provided to the County through the U.S. Department of Housing and Urban Development which was created with the passage of the Housing and Economic Recovery Act of 2008.
The NSP is part of a federal program to help low-to-moderate income families with housing. Organizers plan to rent foreclosed homes initially and leverage the value to buy other properties.
How Nevada was chosen to receive funds:
The Housing and Economic Act of 2008 calls for allocating funds to States and local governments with the greatest need, as determined by:
- The number and percentage of home foreclosures in each State
- The number and percentage of homes financed by sub-prime mortgages in each State
- The number and percentage of homes in default or delinquent in each State
Nevada if one of the top four states that meets this criteria. The City of Sparks alone has an estimated 800 homes in foreclosure or approaching foreclosure.
How the NSP will work:
- Foreclosed homes will be purchased at a discounted rate, rehabilitated and possibly upgraded.
- These homes will then be rented to families with low or moderate incomes.
- The homes will eventually be resold to qualifying buyers.
- The program will not bail out foreclosed homeowners.
The program will help those families who have excellent credit and qualify to buy a home but cannot come up with the down payment needed to secure a loan. The Reno Housing Authority will determine who is qualified and will be in charge of renting the homes.
Ideally, the Neighborhood Stabilization Program will help save neighborhoods from turning into rundown areas. By renting these homes, it not only gives people a place to live, it will give them a change to save and eventually buy a home.
The program will have a few benifits for current homeowners as well. There will be fewer homes that sit vacant in each neighborhood, this cutting down on vandalism. The new renters will be taking care of the property, thus preventing lawns from dying. Another main advantage of having the homes rented instead of vacant is home value. The value of your home will likely increase rather than decrease with homes that are rented rather than vacant.
As a Northern Nevada resident, I hope the Neighborhood Stabilization Program will be the first of many steps to help get our economy back in shape for 2009.
Authored by Terrie Leighton. January 2009. Terrie is a licensed real estate agent with Ferrari-Lund Real Estate in Northern Nevada. The information in this post is believed to be accurate, but is not guaranteed.
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