slide1
Download
Skip this Video
Download Presentation
City of Milwaukee Department of City Development Neighborhood Stabilization Program Federal Reserve Conference November

Loading in 2 Seconds...

play fullscreen
1 / 25

City of Milwaukee Department of City Development Neighborhood Stabilization Program Federal Reserve Conference November - PowerPoint PPT Presentation


  • 422 Views
  • Uploaded on

City of Milwaukee Department of City Development Neighborhood Stabilization Program Federal Reserve Conference November 5, 2009. Foreclosures in Milwaukee Backdrop for the NSP Program. Over 10,000 foreclosure filings in Milwaukee (2007-2008); more than double historical averages

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'City of Milwaukee Department of City Development Neighborhood Stabilization Program Federal Reserve Conference November ' - richard_edik


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide1
City of Milwaukee

Department of City Development

Neighborhood Stabilization Program

Federal Reserve Conference

November 5, 2009

foreclosures in milwaukee backdrop for the nsp program
Foreclosures in MilwaukeeBackdrop for the NSP Program
  • Over 10,000 foreclosure filings in Milwaukee (2007-2008); more than double historical averages
  • Over 5,300 properties are currently subject to an open foreclosure filing – an increase of almost 20% from year end 2008
  • 1,348 Milwaukee homes are currently bank owned foreclosures (REOs). An additional 302 are City owned tax foreclosed properties.
  • Two thirds of foreclosed properties have open building code violations
foreclosures in milwaukee
Foreclosures in Milwaukee
  • Hardest hit areas are CDBG areas; significant City investments are at risk
  • Subprime lending activity peaked in 2005 with over $1 Billion of activity in Milwaukee
  • Subprime lending disproportionately impacted low income and minority families; 59% of 2006 loans in CDBG areas were subprime/high-cost
trends
Trends

Foreclosure filings are up since last year

“Second Wave” – related to economy in addition to predatory lending

trends6
Trends

Number of bank owned properties is declining as prices are being slashed and more buyers are entering the market

In Milwaukee, there have been more sales of foreclosed properties than regular market transactions

slide7
Neighborhood Stabilization Program (NSP)

Milwaukee’s NSP Plan

Program Summary

slide8
Up to 30% of purchase/rehab cost, indexed to buyer income (final levels of assistance being determined).

0% interest 2nd mortgage, forgivable after five or ten years depending on level of assistance received.

Code compliance: Each property will be inspected to insure that it meets the minimum standards for the program. A rehabilitation specialist will prepare a scope of work, monitor the construction and perform a final inspection to insure that the property meets program standards)

Neighborhood Stabilization Program (NSP)

Homebuyer Assistance

Provides forgivable loans for owner occupant purchasers of foreclosed homes

slide9
Up to $17,500 per unit (example: 2 unit property is eligible for $35,000). Funds can be used for rehab costs only and must be matched dollar for dollar by landlord.

Property must be rented to income-eligible tenants and held for a minimum of 5 years. Tenant income: < 60% AMI with priority to landlords who agree to rent to tenants with incomes < 50% AMI.

Code compliance: Each property will be inspected to insure that it meets the minimum standards for the program. A rehabilitation specialist will prepare a scope of work, monitor the construction and perform a final inspection to insure that the property meets program standards.

Participating landlords must have a responsible track record including a good record with the Department of Neighborhood Services and a history of paying their property taxes on time.

Neighborhood Stabilization Program (NSP)

Rental Rehab

Provides forgivable loans to investor purchasers for the rehabilitation of foreclosed homes.

slide10
3.0% interest 2nd mortgage for up to 20% of purchase/rehab cost.

Property must be located within three blocks of purchaser’s primary residence.

Property must be rented to income-eligible tenants and held for a minimum of 5 years. Tenant income: < 60% AMI with priority to landlords who agree to rent to tenants with incomes < 50% AMI.

Code compliance: Each property will be inspected to insure that it meets the minimum standards for the program. A rehabilitation specialist will prepare a scope of work, monitor the construction and perform a final inspection to insure that the property meets program standards)

Neighborhood Stabilization Program (NSP)

Buy in Your Neighborhood

Provides low interest loans for investors purchasing a foreclosed home in their neighborhood.

slide11
What’s Helping

Created guidelines and before launching, met with lenders, home buying counseling agencies and realtors to solicit feedback

Continue to meet to work through issues and identify process improvements

slide12
What’s Helping

Strong Marketing Efforts – Getting the Word Out

Community Organizations

Newly formed Milwaukee Homeownership Consortium

Website

Other Partners – Milwaukee Public Schools, City

employee brown bags, Milwaukee Police Dept.

challenges
Most properties in need of rehab – length of process to approve assistance doesn’t always match timeframe of offer to purchase – lenders/servicers motivated to sell and would prefer to accept a “cash offer”

Access to financing, especially for non-owner occupied properties, continues to be a challenge

Create realistic expectations on process – partners are key in the communication

Working on this – applied for NSP 2 funds, as well as secondary market, and local banks

Challenges
land bank
Land Bank

City formed the Milwaukee Neighborhood Reclamation Company LLC

Forged partnership with National Community Stabilization Trust, as well as individual relationships with lenders

Targeting neighborhoods with ongoing initiatives and past and current investment activities

Currently acquiring first Land Bank properties

slide15
Large Project Pool

Rehabilitation and New Construction

Resources for developers with the capacity to handle larger scale projects

Targeting neighborhoods with ongoing initiatives and past and current investment activities

Issued a “Request for Qualifications” to identify development partners

demolition and reuse funds
Demolition of most severely blighting properties

Where unbuildable lots result, stipends for landscaping, urban gardens, or other productive reuse

Demolition and Reuse Funds
what s helping
Multiple tools (demolition, development subsidy, property acquisition capability) provide more options for making an impact as well as more flexibility in decision making

City already had an established development arm, as well as real estate staff

Utilizing local neighborhood partners to assist in property identification as well as reuse strategies

What’s Helping
challenges18
Property condition – left vacant, properties are deteriorating and/or being vandalized, creating fewer and/or more expensive options for their reuse

DNS property registration and vacant property ordinances

Neighborhood outreach

Challenges
challenges19
Challenges

Foreclosed properties are

selling at 38% of assessed value

Speculators are active in the marketplace – purchasing properties without the intent or capacity to make the necessary repairs

recent examples
Recent Examples

2712 N. 46th St.

2009 Assessed Value: $104,800

Sales Price: $42,000

(10/29/2009)

slide21
What we are doing:

Stepped up homeownership marketing efforts

Considering a real estate broker" incentive program” for owner occupant purchases

Aggressive and coordinated code enforcement efforts

Database for tracking foreclosed properties, as well as properties in the foreclosure process

slide22
Website

www.milwaukeehousinghelp.org

slide23
Additional Resources

Foreclosure Mapping (Public)

slide24
WHAT’S MOST HELPFUL OVERALL?

A coordinated effort –

NSP Program is part of a larger foreclosure strategy for the City of Milwaukee that also includes prevention and intervention activities.

Everybody has a vested interest in addressing the issue – ask them to be part of the effort.

questions
NSP program information, applications, Q & A and information on other City foreclosure initiatives

www.milwaukeehousinghelp.org

Information on the Department of Neighborhood Services foreclosure legislation

www.city.milwaukee.gov/DNS/APIF

Questions?
ad