New York's Plan to Avoid Blight

New York City has announced plans to use $24 million in federal financing to repair and resell more than 100 foreclosed homes in the city.

"The city will use the money to take control of foreclosed properties owned by lenders that have failed to be sold at auction. The city has already overseen the purchase of the first four empty homes - two on Staten Island, one in the Bronx and one in Queens - and renovations are scheduled to begin by this spring."

"The efforts by the city illustrate the impact that foreclosures are having on the city's neighborhoods and, in some ways, echo its response to the housing crisis of the late 1970s and early '80s. Back then, in an attempt to revitalize neighborhoods left decimated by abandoned properties, the city under Mayor Edward I. Koch began taking over the ownership and management of buildings whose owners fell behind on their property taxes."

"Under the new program, the city will not take ownership of the properties, but instead will subsidize their rehabilitation through a third party, a nonprofit group called the Restored Homes Housing Development Fund Corporation. The group will purchase a majority of the 115 properties, hold title to the properties during the rehabilitation and then sell them at prices affordable to families making roughly $80,000 to $90,000 a year. Restored Homes is already doing similar work, buying, renovating and reselling foreclosed homes that the federal government had owned."

Full Story: To Avert Blight, City Will Repair and Resell Vacant Homes

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