Contra Costa County and some of its cities have teamed up to increased their chances of getting $50 million to buy and rehabilitate foreclosed houses for sale in the region under the Neighborhood Stabilization Program.
The number of foreclosed houses for sale is expected to continue to rise as the number of homeowners in default in California and in all other states in the first 6 months of 2009 has increased, based on a nationwide study of foreclosure filings released this week.
According to the nationwide study, over 100,000 foreclosure notices were issued in June to distressed homeowners in California and out of this number, nearly 21,000 have already been counted as foreclosed houses for sale. One housing unit out of every 132 units was issued with a foreclosure notice in June.
It is this record number of foreclosed houses for sale that Contra Costa has been trying to help contain. From the first round of NSP funding, Contra Costa has already spent $14 million to help neighborhood fight blight by buying foreclosed houses for sale and then repair them.
The cities working with Contra Costa are Antioch, Pittsburgh, Richmond, Creek, Bay Point, Montalvin Manor, North Richmond, Oakley, San Pablo, Rollingwood, El Sobrante and Rodeo. NSP has a total of $1.93 billion to allocate in the second round.
Walnut Creek, an area clobbered with around 100 foreclosed houses for sale, hopes to receive up to $5 million from the NSP grant. Housing manager Laura Simpson said these foreclosed properties include town homes, condos and duplexes.
Meanwhile, Pittsburgh, which is another city hit with record foreclosures, hopes to get a bigger share from the NSP funding. Currently, there are 1,253 foreclosed homes and properties in pre-foreclosure in the area.
Lynette Darensburg, an officer at Pittsburgh’s community access unit, said the money would mean a lot for the neighborhoods of West Boulevard which are reeling from foreclosures.
Unlike the first NSP funding which had strict limitations on how the funds are going to be spent, the second funding gives more flexibility to cities and counties.
However, there is an additional requirement, which is to make housing rehabilitation projects energy-efficient and environment-friendly.
In many Contra Costa cities, they plan to spend the NSP funds to help first-time homebuyers buy foreclosed houses for sale located in the most battered communities by providing them with money for down payment.
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