Louisiana’s Road Home program could end up buying about 7,000 hurricane-damaged properties in New Orleans, creating what one faith-based group sees as a golden opportunity for new homeownership in a city that had a high percentage of renters before Hurricane Katrina.
The Jeremiah Group wants half of the buyouts in the city set aside for homeownership and the other half used for green space or larger developments.
Of the properties set aside for home redevelopment, half would be designated under the group’s proposal, which it plans to pitch to the New Orleans Redevelopment Authority, the agency expected to take control of Road Home buyouts in New Orleans.
The group envisions a program in which a second mortgage becomes a free grant if the buyer stays in the home at least a decade. The group wants to get $50 million in soft-second mortgage money from various sources, funding Jeremiah Group organizer Nell Bolton said is key to helping make the homes affordable. Even if prices of the rebuilt homes are kept to $150,000, low- to moderate-income families would need $50,000 in aid to pay their monthly mortgage, Bolton said.
Officials with the group said $50 million, figuring $50,000 in aid per properties, would only cover 1,000 homes but would be a start.
NORA’s executive director, Joe Williams, said his agency shares with the group goals of a goal of boosting homeownership. But the group’s hope that NORA will give homebuilders properties for free – to keep construction costs down – may not be consistent with federal housing rules, NORA’s Ommeed Sathe said.
More than two years after Katrina, about 13,000 Road Home applicants – about 4,000 of them in New Orleans – have chosen to sell their properties to the state. About 50,000 applicants have yet to decide whether to sell or rebuild.
But if percentages hold, Road Home could buyout 18,000 to 22,000 properties in Louisiana, about 7,000 of which could be in New Orleans. The Jeremiah Group projects most of the properties in the city would be concentrated in the 9th Ward, Gentilly and a portion of eastern New Orleans.
Road Home holds properties it buys in the Louisiana Land Trust, which can begin transferring properties to local agencies after parish authorities devise state-approved land-use plans. NORA plans to submit its plan to the Louisiana Recovery Authority next month.
The land trust has a revolving fund to cover security and maintenance costs but NORA doesn’t. It could cost the cash-strapped agency $12 million a year to keep up 7,000 properties.
Williams said NORA is in talks with the city and state agencies to find funds.
Information from: The Times-Picayune, www.timespicayune.com
Was this article valuable?
Here are more articles you may enjoy.