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Stimulus money lets St. Petersburg buy foreclosed homes

ST. PETERSBURG — A teal house sits abandoned on 10th Street at Ninth Avenue S in Campbell Park. The windows are boarded up and the paint is starting to peel. A tan house next door has multiple holes in its side with covered windows as well.

The city is considering buying the teal house as part of a government program that would refurbish foreclosures in hard-hit areas.

Deontae Jordan, 19, said he's glad the house could be fixed up. He laughed and said the city also should buy the tan house, which has been abandoned for eight months.

"It does make the neighborhood look bad," said Jordan, who lives a couple of houses down on Ninth Avenue S.

The teal and tan houses aren't alone. The city is starting to buy dozens of homes using a $9.4 million federal grant through the Neighborhood Stabilization Program, which was created last year.

This spring, Congress included nearly $2 billion in the federal stimulus package for a second wave of funding for the program. City officials plan to apply for twice the original grant, or $20 million. Awards are scheduled for December.

The city has already bought five properties and could close on seven more next month. Officials hope to refurbish nearly 60 single-family homes and more than 30 multi-family homes.

The idea is to repair or tear down homes that can't be absorbed by the market. By removing abandoned, rotting homes, officials hope to reduce negative effects of foreclosure.

"We're focusing on the worst of the worst in the neighborhood," said Tom de Yampert, manager of the city's housing rehabilitation team.

The larger grant could purchase another 170 single- and multi-family homes. It would also provide down payment help to about 85 families.

Unoccupied and foreclosed properties in nearly every corner of the city could be considered in the second wave of funds. The current program only focuses on a few priority areas, such as Childs Park and Midtown.

"It would increase the market area, if you will, for where we would be able to go out and purchase properties," said Mike Psarakis, who negotiates purchases for the program in the city's real estate department.

About two-thirds of the homes the city buys will be demolished and rebuilt. The second grant would pay for fewer demolitions, about 25. But some homes are so far gone that tearing them down is the only logical step.

"It could be damaged so severely where there's nothing to do but demolish it," said Joshua Johnson, director of St. Petersburg's housing department. "You're going to spend way more money rehabbing it than you would demolishing it."

Stimulus money lets St. Petersburg buy foreclosed homes 07/07/09 [Last modified: Tuesday, July 7, 2009 1:57pm]
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