NCST is coming up on the NINTH anniversary of our formation and the launch of the First Look program, originally piloted in the fall of 2008 as a tool to stabilize neighborhoods at highest risk from foreclosures. All these years later we find ourselves on the other side of a lot of activity driven by tremendous partnerships – more than 20,000 property transfers to more than 1,000 community buyers in 48 states. And we’re still going, even in a market environment that continues to change…fast.
In the last nine years, there has been an evolution to neighborhood stabilization, the goal that NCST’s programs are designed as a tool to serve. A lot of macro-level changes to the housing industry and market have had great influence on NCST programs and how we’ve intersected with neighborhood stabilization, many of which involved changes among our REO seller partners – who has REO inventory, where is it located, and how is it valued and priced. But we’ve also been witness to how our community buyer partners have significantly changed their approach to the work they do in the single-family space – shifts in geographic focus, post-rehab strategies, development partnerships, and capital providers.
So what is neighborhood stabilization in 2017? Here is what some of NCST’s long-time community buyers recently shared with us about what neighborhood stabilization means to them now and how they view their organization’s evolving role in creating stronger neighborhoods.
- Atlanta Neighborhood Development Partnership, Inc. (ANDP) | Atlanta, GA
- “In Metro Atlanta, the best Neighborhood Stabilization strategies lift values in underwater neighborhoods, restoring lost family wealth and homeownership. ANDP is on a path to increase our single family production sale by 50% or more over a three year period. Securing new capital sources outside of NSP has been critical to our success. Our top goal is to acquire and rehab homes for sale to low- and moderate-income homeowners. Given current market credit and appraisal gaps, we’re also looking at ways to finance homes initially as rental while providing pathways to return the stock to homeownership tenure over time.” John O’Callaghan, President & CEO
- New Jersey Community Capital (NJCC) | Community Asset Preservation Corp. (CAPC) | Newark, NJ
- “As the largest CDFI in New Jersey, New Jersey Community Capital (NJCC) prides itself on its nimble approach to community development, being able to respond to crisis and the ever changing needs of NJ’s neighborhoods. Neighborhood stabilization is still a very important and relevant topic in NJ, which continues to have a very high foreclosure rate; among the top in the nation. While upper- and middle-income communities have largely recovered, low- and lower middle-income neighborhoods continue to see depressed housing markets, high foreclosure rates, and disinvestment. NJCC remains very involved in neighborhood stabilization efforts. In fact, our scope and scale has actually increased since the end of NSP. NJCC has moved to a dual disposition strategy to create both rental and homeownership opportunities. On the rental side, our real estate subsidiary Community Asset Preservation Corporation (CAPC) continues to buy homes in neighborhoods that have seen high foreclosure rates and stagnant values. We believe our work in these communities is important to foster stability and eliminate blight. It also gives us the opportunity to create quality, affordable rental units. To date, CAPC has over 200 scattered site rental units and our average tenant’s AMI is below 50%. We have done this by attracting rental subsidies and partnering with social service-focused nonprofits who work with various special needs and vulnerable populations. Scattered site housing enables these organizations to better integrate their clients into local communities, avoiding the NIMBY issues encountered in new construction. In the area of for-sale housing, CAPC continues to work in middle-income neighborhoods, but has also expanded its work into communities that have lower poverty rates and higher performing schools. Through NCST’s partner REO sellers, CAPC has been able to purchase homes in neighborhoods that are often stable, but have rising values and home prices. Coupled with the NCST discount, CAPC is able to make homeownership possible for moderate-income households in these communities with $50,000 down payment assistance grants we received as part of a large bank’s mortgage settlement. These homes are having a big impact on families living at the edge of affordability to help ensure homeownership opportunities remain in places seeing quickly escalating prices.” Jeff Crum, Director of Real Estate, and Dani Rosen, Director of Operations
- Community Investment Corporation (CIC) | Chicago, IL
- “To stabilize a community, you’ve got to eliminate the vacant eyesores that are constant reminders of deterioration and disinvestment. Over the last few years, we’ve been able to acquire almost 300 vacant properties and transfer them to local rehabbers. The majority of these properties have come through NCST, whose platform has enabled us to cluster our acquisitions in order to reverse the cycle of decline and maximize the beneficial impact of our rehab and reinvestment activity.” Jack Markowski, President and CEO
- Chicago Metropolitan Housing Development Corp. (CMHDC) | Chicago, IL
- “In order to create a stable community, it’s important to recognize communities evolve constantly and with that comes changes that may affect long term residents of a community. It is critical not to stop change but to find ways to ensure long term residents remain in their communities through these changes. This ought to be a non-confrontational effort that allows everyone to participate. I strongly believe the private sector, non-profits, and philanthropic organizations should step up to the plate and come out with solutions to improve communities. Government agencies should stand ready to assist, but it is the private sector that should find feasible alternatives to stabilize neighborhoods while limiting the use of dwindling government dollars. Everyone needs to contribute something and all contributions are valuable.” Rafael Leon, Executive Director
- R.E.A.C.H. | Palm Beach County, FL
- “Neighborhood stabilization means more stable, family-filled homes moved from blight to life; disrepair to repair; abandoned to occupied. REACH continues to seek grant funding for purchasers, train in homeownership and create a firm foundation for families moving into new purchases or those returning to market place. Our focus will continue to be the immigrant population – Miami alone boasts of 100 languages spoken. The joy of homeownership beams from the faces of new homeowners; smiles and their new found wealth of stability and dollars. This stability then feeds the community and creates soundness. We will continue to seek funding such as the Florida Community Loan Fund to provide capital for repairs. And, we will reach out to those small business nonprofit providers to assist with job training knowledge. Rental units will become a larger part of our product offering as home prices continue to rise in South Florida. Without NCST we wouldn’t be able to battle against the cash investor. It’s the great privilege of REACH to provide housing to those that are qualified, capable and prepared but never had a chance against the large dollar odds. REACH will also explore lending needs and mortgage availability for our clients. In summary, we will continue to serve, work with our partners and deliver housing where we are aware of the need and desire. One house, one family, one community…reach out and we will reach back!” Pat Tracey, CEO
- Southwest Housing Solutions | Detroit, MI
- “In 2017, Southwest Housing sees neighborhood stabilization as rewarding but a different type of rewarding. Southwest is seeing more new first-time homeowners than ever. We’ve evolved from the downsized and distressed homebuyer to the new, optimistic homebuyer. Southwest continues to put homeownership ahead of rental in the neighborhoods we work in. In the City of Detroit, we are able to offer alternatives of quality housing at and below the $100,000 price point as we see stabilizing values and appraisal numbers that actually work in neighborhoods outside of the booming downtown. Putting a family into ownership at a monthly payment less than their monthly rental rate keeps our team motivated. That can be a recipe for household financial success.” Steve Gabrys, Director of Real Estate
- Housing For Nevada dba Home Today, Inc. (HFN) | Las Vegas, NV
- “With record low inventory in our market, the projects through NCST offer access and opportunity for first time homeowners as owner occupied buyers that would not be otherwise realized, which is important for neighborhoods. Home buyers are not able to compete with cash investors whom are winning multiple offer transactions in our current low inventory environment. For many of the homeowners that our organization has assisted, they have written up to 7-10 offers and been outbid by cash investors. Due to this, NCST and the First Look program continue to be a much needed lifeline for owner occupant buyers as we focus in the homeownership space.” Christine A Johnston, President and CEO
- Neighborhood Partnership Housing Services, Inc. (NPHS) | San Bernardino County, CA
- “NPHS’s neighborhood revitalization program has evolved into a comprehensive, multi-pronged strategy. In partnership with NCST, NPHS acquires vacant properties, renovates them, which includes greening the homes, and then sells them to low- and moderate-income first-time homebuyers. As part of our comprehensive approach to revitalization, NPHS also provides home improvement loans and exterior beautification grants to the surrounding homeowners to maximize the impact and curb appeal in the neighborhood. NPHS also offers low-cost solar panels systems to the buyers purchasing NCST properties and to the homeowners within the same neighborhood.” Clemente Arturo Mojica, President and CEO
How has neighborhood stabilization evolved for your organization? Please share your thoughts with us today.
By Annie Carvalho. Annie serves as Vice President, Strategy & Development for NCST.