It was heartening to hear President Obama unveil a number of domestic economic policy initiatives in last night's State of the Union address--policies that will hopefully come as a much-needed respite for a middle class struggling through a deep recession. But while everyone's attention shifts to job creation, we must be careful to remember that the housing crisis is far from over.
Earlier this month, HUD released another $2 billion in funding to states, local governments and non-profit housing developers to strategically fix up neighborhoods that have been hardest hit by foreclosures. Continuing to ensure that those federal Neighborhood Stabilization Program (NSP) dollars are wisely maximized is in all of our best interests. More than two million more homes are forecasted to be lost in 2010, which could drive home prices down even further. Some experts believe housing price recovery is as far off as 2013.
The unprecedented scale of the housing crisis has left all parties in a terrible state of confusion. How do I get answers? How can I gain clarity over the situation? Which agencies should I be listening to? How can municipalities best spend their portion of federal government funding?
Two vastly different players who have not had much reason to communicate so closely in the past--large financial institutions and local housing and community development providers --now find themselves needing to collaborate in unprecedented ways to keep whole communities from being decimated by empty, deteriorated properties.
The National Community Stabilization Trust (http://www.stabilizationtrust.com) was borne out of this need for better communication. The Stabilization Trust builds bridges between financial institutions and local housing organizations in two ways: by improving access to foreclosed properties and increasing access to private capital. In doing so, the Stabilization Trust is helping to unclog foreclosure inventory pipes by enabling local agencies to maximize federal dollars to acquire properties while encouraging financial institutions to transform dormant property inventories into productive housing. The organization was created out of the unique collaboration of six of the nation's leading community organizations: Enterprise Community Partners, the Housing Partnership Network, Local Initiatives Support Corporation, NeighborWorks America, National Urban League and National Council of La Raza.
Last winter, the Stabilization Trust began its pilot property acquisition program in Minneapolis and St. Paul. Within eight months, over 150 properties were successfully transferred in the Twin Cities from participating financial institutions to local housing providers. More recently in Utah, the Utah Center for Affordable Housing (UCAH) has been able to successfuly use more than 80% of the state's $16 million NSP allocation since August 2009 to acquire 64 housing units, in large part due to collaboration with the Stabilization Trust. These activities will lead to the development of another 217 units of affordable housing. These case studies illustrate how the Stabilization Trust helps local housing organizations to do their jobs more effectively while enabling financial institutions to yield meaningful returns.
Looking to the year ahead, there is much work left to do. Block by block, the state of our neighborhoods tells us much about the state of our union.