$900K in Stimulus Funds Used to Buy, Rehab 8 Foreclosed Homes

Have a vacant, neglected foreclosed home in the neighborhood?

The City of Largo received a federal grant through the Neighborhood Stabilization Program 2 (NSP2) to purchase and rehabilitate foreclosed single family homes. The city used $936,500 to acquire eight homes and has fixed seven of the home so far, according to a city report. 

The first home purchased and fixed through the NSP2 program has been sold. Four of the remaining six homes have pending sales contracts and should be sold soon. The city expects all of the rehabilitated houses will be sold by the end of the month, wrote City Housing Manager Matthew Anderson in a report.

The program is helping neighborhoods around Largo. Often foreclosed homes are in need of much work. Neighbors have praised the program, Anderson said.

"Neighbors absolutely love the program. It helps the neighborhood so much to improve these homes," Anderson said.

The net proceeds from the home sales will be spent for future neighborhood stabilization programs, Anderson wrote.

Most of the foreclosed homes need a new roof, windows, doors, floors and more. The city puts the work out to bid and contractors then make the repairs, Anderson said.

The foreclosed homes are purchased at up to 99 percent of the appraised value. The homes are appraised again after the improvements are made and sold at that new appraised value, Anderson said.

The foreclosed homes are all around Largo. The city uses special census maps, which show where it can buy the homes for the NSP2  program, Anderson said.

Families wanting to buy a home through the NSP2 program must meet income requirements and cannot currently own a home. For a family of four, this means the family can earn up to $67,800 per year, Anderson said.

The federal program was created to "stabilize neighborhoods whose viability has been and continues to be damaged by the economic effects of properties that have been foreclosed upon and abandoned," according to the federal HUD Web site.

The federal monies come from the American Recovery and Reinvestment Act of 2009, commonly referred to as the Stimulus Act.

NSP2 is one of several programs the city offers to rehabilitate and purchase homes. The programs include help with financing the purchase of a home.