Picking Up The Pieces

Still pretty deep in a national economic downturn, most of us probably still don't quite get how hard life was for our grandparents or great grandparents during the Great Depression 80 years ago. But we've certainly gotten a pretty strong taste.

"Generic" rehab photo

Look around these days and you'll find plenty of newly broken wallets, broken homes and broken dreams. You notice it particularly in certain neighborhoods once booming and bustling with life but now, thanks to a wave of forecloses and abandonment, bereft of the vitality they enjoyed just a couple of years ago. Foreclosed and abandoned homes, observes HUD Secretary Shaun Donovan, can "have a debilitating effect on neighborhoods and often lead to reduced property values, blight, and neighborhood decay."

Pay a visit, for example, to Boise, the capital city of Idaho and the seat of Ada County. It's been hit hard. Real hard.

In February 2010 Idaho's foreclosure rate ranked seventh among the 50 states, reports RealtyTrac, with one foreclosure filing in February 2010 for every 296 households. That's considerably higher than the national average of one for every 418 households and though filings in February 2010 were down almost 17 percent from the month before, but up almost 23 percent from a year earlier.

Slowly but surely, though, many of these hard-hit neighborhoods are picking up the pieces. Though it got off to a slower start than planned, just a year after President Obama launched the Making Homes Affordable Program more than 4,100 at-risk or deep-in-trouble Idaho homeowners have obtained permanent or entered into trial modifications enabling them to afford their mortgages and, thus, hold onto their homes. Thousands more have used the program to refinance existing mortgages thereby helping them stay out of trouble.

Local governments in Idaho also have stepped to the forefront. Using HUD Neighborhood Stabilization Program funds from the City of Boise, for example, the Boise/Ada County Housing Authority has moved aggressively to acquire 25 abandoned or foreclosed properties. Its plan was to reclaim, rehab and re-sell the properties before, as Secretary Donovan has explained, they were able to eat away at what was still strong and vital in the neighborhoods where they're located.

The Authority moved quickly, already re-selling 17 of the 25 homes to low-income, providing, by the way, almost 1,700 hours of much needed work for rehab firms and restoring property worth a total of more than $2.3 million to local property tax rolls.

And the Authority's also aggressively trying to make sure the new owners can afford to be homeowners. Like a woman we'll call Patty. She's a single mom who works at Wal-Mart and, since 2003, has held a Section 8 rental assistance voucher. But she'd always dreamed of owning a home. Thanks to her job, her "very good" credit and very little outstanding debt, an Idaho Housing Finance Association homebuyer seminar and the Authority's decision to convert her rental voucher into a homeownership voucher, Patty was a perfect candidate for one of the Authority's NSP homes.

She's closed and moved into her new home, the first she's ever owned. It was obviously good news for her but also good news for a neighborhood put at risk by a house that had stood empty too long.

"With all the challenges and frustrations resulting from the economic crisis, there are some bright spots worth noting," said Deanna Watson, executive director of the Authority. "One of the most gratifying aspects of our work with HUD programs is when we can see the results of the funding along with our efforts connecting families in need with new affordable homeownership opportunities. Each closing is both gratifying and inspiring."

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