This December marks three years since we first expanded the Neighborhood Stabilization Initiative (NSI) to 18 markets, and one year since we expanded to our current 28 markets. NSI is a joint effort with Fannie Mae, Freddie Mac, and the Federal Housing Finance Agency through which our Community Buyers get a “first look” at REO properties from those sellers.
by Julia Gordon, Executive Vice President for NCST
Anniversaries provide a great excuse for celebration and an ideal opportunity for reflection. I’m delighted to share some highlights of what we’ve accomplished with our national seller partners and our tireless local partners/Community Buyers in the NSI markets.
- More than five thousand properties (5,233 to be exact) have moved into the hands of organizations that will put them back to productive use.
- Community Buyers have saved more than $118 million by acquiring these properties through the NSI.
- Properties have benefited from robust and thorough rehabilitation efforts, with investments in rehab that average two to four times the amount invested into properties that are not purchased through REOMatch.
But the numbers only tell a small part of the story. The real value in NSI lies in the outcomes we achieve at all levels.
Most important, of course, are the outcomes for the people who get to live in those rehabbed houses. For example, a National Guard veteran and his wife bought their house in Woodstock, GA, through a veterans’ program run by community buyer Atlanta Neighborhood Development Partnership, Inc. (ANDP). In another program aimed at veterans, Maryland community buyer From House to Home put more than $70,000 into a property that had been vacant for years. The new homeowner told them, “I can’t wait to get settled in and live our lives there and watch our children grow up there.”
Similarly, a family who purchased a home from Philadelphia Residential Revitalization wrote the following: “Owning a home is a dream that I didn’t think I was going to be able to achieve being a single mother working to raise three children. It happened for me and it’s honestly a dream come true. I’m really grateful to be given this opportunity. These people helped me with every obstacle and talked me through it. Not only are they awesome business people, but even better human beings. Thank you for everything. I don’t think I’ll ever be able to say enough thank yous!”
On the affordable rental side, MJ Realty worked with a single mom with four kids who was able to leave a rental ridden with mold and code violations and move to a beautiful home in the historic North Rosedale Park neighborhood of Detroit at a monthly rent well below market level. In this instance, the buyer even worked with the new tenant to select home finishes, including paint color.
Beyond individual stories, putting these distressed properties to productive use provides benefits for the entire neighborhood and even the local government. Property taxes are once again being paid, code violations have been remediated, and the home no longer poses risks of fire, crime, or other health hazards. While NSI properties are only one source of properties for most of our Community Buyers, their work overall has contributed to raising property values in their service areas and to enabling many families to access the numerous benefits that flow from homeownership.
Another NSI outcome that gets less attention is the benefit to the NCST community buyers themselves. Sourcing properties has become increasingly difficult and competitive, as so many properties change hands through private arrangements even before a house comes on the market. Even when properties get listed on the MLS, beating out the competition from private investors is challenging. Through NSI, buyers can count on a true first look at Fannie and Freddie properties in their service areas – one that cannot be gamed by agents or investors. NCST’s mission to strengthen Community Buyers is more important now than ever, as changes in REO management practices and fintech innovations make it easier than ever for single family homes to be acquired by investors who manage them poorly, leaving them vacant, renting them out without properly rehabbing them, or even mistreating tenants or aspiring homebuyers.
So what next? How can we continue to improve the NSI program to achieve better results for aspiring homeowners, communities, and buyers themselves?
Over the next year, NCST will reach out to many of its stakeholders as we learn how to improve NSI and other programs. We’ll ask community buyers to participate in buyer roundtables around the country to exchange best practices and provide feedback on program strengths and challenges. We’ll talk with current sellers and other financial institutions to brainstorm ways to improve our programming and offer access to properties that meet buyer needs with respect to both place and price. And we’ll reach out to past, present and future supporters to learn how an investment in NCST can provide even more value for those who care about offering equitable access to strong, stable communities across all geographies and populations.
Best wishes for the holiday season, and we look forward to working with you in 2019.
Julia Gordon serves as Executive Vice President for NCST