Helping Homes And Home Buyers In South Phoenix
We finish our “Phoenix Votes” series with a look at housing in District 8.
After the foreclosure crisis, the city received more than $115 million federal dollars to rehab distressed properties, many of which were in the sprawling District 8. With the Neighborhood Stabilization Program ending soon, President Barack Obama proposed a replacement this week while visiting Phoenix. But it’s uncertain if it will move forward.
Stephanie Reynolds was sitting with her two youngest children at a big, wooden table. As the youngsters laughed, Reynolds drew the face of a smiling puppy. This is her dining room, in her house – bought with the help of a low-interest loan and $15,000 from the federal program. This neighborhood near South Mountain was hit hard by the housing crisis, like much of District 8, which covers a huge swath of South Phoenix.
Before Reynolds moved in this April, she had been living in her mother’s house for 30 years. Her new place has made a big impression on 6-year-old Sam and 2-year-old Monika.
“Any time we pull up the driveway, ‘Bye house, bye new house, bye new park,’” Reynolds said. “And we come back, ‘Hi, house.’ They’re still very excited.”
Reynolds is excited, too, because she got into the program before it ended. The city is responsible for distributing the federal neighborhood stabilization money, and all of it must be spent by April 2014. A new program, called Project Rebuild, is dependent on the approval a very divided Congress. Without this kind of program, Reynolds says families like hers would be left with few options. She’s a para-pro, similar to a teacher’s assistant, on a modest salary.
“When this program came along, it gave me hope that, well, OK, I can, you know, purchase a home, because I don’t think I would have been able to without this program,” Reynolds said. “For sure I wouldn’t.”
Realtor Maricruz Martinez hears that a lot. As she walked through one of the program’s spacious, energy-efficient homes, she described how excited first-time buyers are when she hands them the keys. In her words, that's "the best part."
“It’s doing so well for a lot of people,” she said. “It will be a shame if they go away with the program.”
At this point, that’s not up for debate. What is, is whether something else will take its place. Though Arizona Governor Jan Brewer did not specially mention Obama’s proposed replacement, she criticized what she called his “big government” plans.
But Shaun Donovan says that kind of intervention matters. The U.S. Housing and Urban Development Secretary joined the President in Phoenix this week. Donovan says 75 percent of communities that have used stabilization dollars have seen vacancy rates go down and home prices go up.
“So, it really is working,” Donovan said. “It’s something that we ought to invest in more. It’s something the president has called for – and why he’s put in his budget – Project Rebuild.”
But will it be enough to make a real impact? The current program helped hundreds of new home owners in the area. But that hardly compares to the number of foreclosures in Metro Phoenix at the height of the crisis – more than 500,000 in March 2010 alone.
With stabilization funds, scale has always been a problem, says Harold Simon. The executive director of the National Housing Institute says the $7 billion the program allotted nationally was never enough. Still, it was a start.
“When you have a lot of abandonment, or foreclosure that leads to abandonment, you just have to have interventions,” Simon said.
And that’s where Patricia Garcia Duarte with Neighborhood Housing Services of Phoenix, hopes to come in. Garcia Duarte plans to charge forward – regardless of whether or not a new government program comes to be.
“Use the same concept, use different kinds of funding sources to continue to acquire and rehab homes, and then put them in the hands of counseled and educated families,” she said.
For Garcia Duarte, “educated” is the key word. Since the beginning, buyers with the program have had to take a class and go through counseling about the realities of home ownership. Even though the program is going away, Garcia Duarte thinks this emphasis on education is here to stay.
“So, yeah, the consumer is not going to get burned again,” she said. “And hopefully they won’t forget.”
But soon, they also might not be getting as much financial aid. And city leaders will decide how or if they’ll look for ways to fill the gap.