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Montgomery County received more than $4 million from the U.S. Department of Housing and Urban Development last week to acquire and renovate foreclosed homes and rent them to county residents, County Executive Isiah Leggett (D) announced last week in Aspen Hill.
The announcement came March 25 in front of a foreclosed home that the county helped Habitat for Humanity purchase and renovate as part of a similar initiative Leggett announced in November.
Six houses will be purchased right away in Aspen Hill and Germantown, Alston said. The HOC will contract out construction companies to renovate them, spending a maximum $300,000 for acquisition and renovation per house, she said.
Alston said the initiative, while helping a relatively small number of families, is far reaching. It will create jobs in the construction industry, add to the county's affordable housing stock and expand rentable properties in the county, she said.
Paired with Leggett's $3.5 million partnership with Habitat for Humanity—paid for by county's Housing Initiative Fund—a total of 16 houses will be purchased and renovated in the county for families, with the possibility of several more coming.
Leggett said Montgomery County's foreclosure rates have been increasing since last fall as incomes are lost and the price of housing stays the same.
"This county is no longer immune to the problem," he said of foreclosures.
The average income in the county is about $96,000 per household, and the average cost of a single-family home is about $485,000, according to 2007 data from the Maryland-National Capital Park and Planning Commission, the most recent data available.
The HOC will rent the homes to people who earn 50 percent of the county's average income, while Habitat for Humanity helps people who earn 30 percent to 50 percent.
The HOC will rent out houses for a yet-to-be determined price, Alston said, and the Habitat for Humanity houses will be sold to homeowners for $120,000. Potential Habitat homeowners must be able to pay a low-interest mortgage and willing to help Habitat construct more houses.
Shana Newman, corporation and foundation manager for Habitat for Humanity's Montgomery County affiliate, said the number of people in line for affordable housing is staggering. Newman said some 400 people applied to purchase the first house Habitat for Humanity renovated under the program.
"It's a huge need," she said. "There are working families paying 50 percent to 75 percent of their income to rent."
Since he was elected in 2006, Leggett said he has been determined to find ways to quadruple housing aid in the face of a budget deficit. Next year, he said, he plans to allocate roughly $80 million in local bonds and general county funds for affordable housing, up from $54 million this fiscal year and with an ultimate goal of more than $100 million.
The $4 million in federal money comes from HUD's Neighborhood Stabilization Program as part of Congress's Housing and Emergency Recovery Act. Montgomery County received $2 million directly from HUD and was awarded an additional $2.5 million from the state's Neighborhood Stabilization Program money.
Maryland received $46 million overall from the program, said Raymond Skinner, secretary of the Maryland Department of Housing and Community Development, who was also present at last week's event.
Eleven other counties and two municipalities in Maryland were awarded money, but Montgomery County was one of the first in the state to act on it, Skinner said.
"Every home counts," he said.
