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Getting Foreclosures Back on the Market

By Robert Freedman, senior editor, REALTOR® Magazine

Watching the decline of a once vibrant neighborhood is always saddening but its particularly so when the decline is due to a rash of foreclosures that, with a little bit of foresight, could have been prevented. That’s why NAR’s new neighborhood stabilization project comes at an especially important time: it actually gives associations of REALTORS® some resources to help their members do something to restore a neighborhood facing decline before foreclosures turn it into a wasteland.

A couple of weeks ago I got a good look at how NAR’s program works when I spent the morning with Mabel Guzman, ABR, president-elect of the Chicago Association of REALTORS®, who showed me around two neighorhoods that are teetering between success and failure. The neighborhoods are among about two dozen in Chicago that have seen a rise in foreclosures and vacancies, so they’re seeing more homes getting boarded up and at risk of vandalism.

But there’s hope for those neighborhoods because households and investors have a sense that they have a future. Here’s why: her association has been working with the city and the city’s nonprofit partner to plan how the city can purchase a critical mass of the foreclosed properties, fix them up, and, with the help of REALTORS®, get them back on the market before the neighborhoods get so downtrodden that households will no longer want to buy there.

Where is the city getting its program money?—from the federal government. Congress made $6 billion available to cities through economic recovery legislation for the sole purpose of buying, rehabbing, and reselling foreclosed properties.

The key point to this program, at least in Chicago, is that REALTORS® are involved both in the planning of the program and in the selling of the properties. All too often in the past, at least in many cities, programs like these have mixed success because REALTORS® aren’t brought in to play a role. As Brian Bernardoni, government affairs director of the Chicago Association of REALTORS®, told me, cities and nonprofits understand how government programs work but they don’t know how to move property. REALTORS® know how to move property.

In Chicago, this involvement with the city didn’t come by accident; the association was aggressive in making sure it was at the table when the city and its nonprofit partner received the money and starterd planning the program.

NAR is hoping to replicate the success in Chicago and in other cities that are getting involved by providing assistance to state associations so that they can help local associations be at the table when the city government in their area is planning how to spend their federal neighborhood stabilization money and how to resell the homes.

NAR’s program isn’t intended to give every association intensive assistance. Rather, it’s intended to give intensive assistance to state associations that have some of the hardest-hit foreclosure areas in the country. For other assiociations, it has available a comprehensive online toolkit that should provide just about everything they need to take the first steps to getting involved.

The video above explains how NAR’s program works, where to get more information, and whom to contact. I think it’ll give you a good understanding of how NAR’s effort fits into the massive federal effort to shore up neighborhoods before they decline too far into blight.

Robert Freedman

Robert Freedman is manager of multimedia communications for the NATIONAL ASSOCIATION OF REALTORS®. He can be reached at rfreedman@realtors.org.

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Comments
  1. John Edmunds

    The neighborhood stabilization programs are just another way of income distribution at the same time putting thousands of government jobs on the payroll. It has been a complete failure in Las Vegas and was so poorly run that the non profit in charge of our program was unable to properly complete it’s application for the federal money and didn’t get it. So Harry Reid got a $million or so dumped into the groups hands to hire and train people on how to get the federal money.

    These governemnt programs are nothing more than ruses to transfer wealth and explode the government intervention into all facets of our lives. None of the Fed programs work, name me one government program that is not in default, Soc Sec? Fannie Mae, Freddi Mac, Medicare, Post Office? Please send me an email on something they do well and don’t say the IRS.

    Now the major mortgage companies are going to lower principle balances on underwater mortgages. That is a slap in the face to anyone who has worked hard their entire life and put 40-50% or all cash down to buy a house.

    How NAR can stand by while the government lawyers rewrite the book on selling real estate via “short sale” is beyond belief. The liability of doing a short sale is mind boggling. The future litigation and destruction of the Realtor memebers is forthcoming. Errors and emmissions insurance will be plundered by lawyers as will association coffers. All of these fees will then be doubled or trippled to pay the attorneys. NAR must get their act together and stop this herd mentality.

    I do not need to know which PDA to buy or that floor plans sell a house. Make a difference to your members and stop the government take over of the real estate industry.

    John Edmunds
    Broker Salesman
    30 year real estate veteren

  2. trace banks

    John Edmunds is EXACTLY RIGHT! PLEASE PAY ATTENTION TO HIM. Look at what we are becoming!!!
    Trace Banks- infopreneur-real estate investor

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