Public Program to Stave Foreclosures Lags

By Odette Yousef

Atlanta, GA – Ten months after winning more than $12 million to buy, renovate, and sell foreclosed homes, Atlanta's only put one house on the market. City officials had hoped to be further along with the federal Neighborhood Stabilization Program, but private investors are outbidding them on homes.

Atlanta's used only $1.6 million of its grant, and has fewer than eight months to commit the rest of the money, or the city will lose it. But Atlanta Commissioner of Planning and Community Development says the problem is that the city is looking at the same homes as private investors.

"We don't want houses that are vacant and dilapidated, we want houses that have some bones that we can work with," said Shelby.

Shelby added that Atlanta, like private investors, ultimately wants to sell the houses to new homeowners. But unlike investors, the city has to comply with strict federal rules.

"We have to appraise the property," said Shelby, "and once we appraise the property, we have to be 1% below the market value."

But because private investors don't have to follow rules by the federal Department Housing and Urban Development, they have been able to offer more than the market value for the homes.

So far, Atlanta has bought 39 homes with the NSP grant. Shelby hopes the city will ultimately buy and renovate 300 homes.