By Erika Webb
Deltona has sold 64 homes, has 22 on the market and nine undergoing construction or rehabilitation through its participation in the Neighborhood Stabilization Program.
The Deltona City Commission voted Jan. 6 to approve a list of real estate brokers to be used within the Neighborhood Stabilization Program: Watson Realty Corp., DeLand; RE/MAX Associates Inc., Deltona; Total Realty Corp., DeLand; and Weatherspoon Realty, Lake Mary.
Deltona became a NSP community in 2008, with the NSP 1 program for about $6.6 million and is now included in the NSP 3 program for $1.96 million, according to Deltona's Public Information Officer Lee Lopez.
Volusia County uses NSP funds to acquire foreclosed and abandoned homes in targeted neighborhoods. Like Deltona, the county uses approved contractors to rehabilitate the properties. Once the homes are completed they are listed for sale to approved income-eligible, first-time homebuyers who also meet other program guidelines, according to Volusia County Community Services.
The program provides a loan for purchase and closing cost assistance for easier affordability.
Volusia County's NSP homes are in neighborhoods in DeLand, Orange City, Edgewater, Holly Hill and Ormond Beach, according to Volusia County spokeswoman Pat Kuehn.
"Daytona Beach receives its own NSP funds. Port Orange is not eligible for the county's NSP funds because the city receives its own CDBG (Community Development Block Grant) funds. This was a determination made by HUD in allocating NSP funds," Ms. Kuehn noted.
Nationally the NSP was established to stabilize communities that have suffered from foreclosures and abandoned houses, according to the U.S. Department of Housing and Urban Development.
"Through the purchase and redevelopment of foreclosed and abandoned homes and residential properties, the goal of the program is being realized," the agency's website, hud.gov, reported.
NSP 1 references the NSP funds authorized under Division B, Title III of the Housing and Economic Recovery Act (HERA) of 2008 and provides grants to all states and selected local governments on a formula basis.
NSP 3, references the NSP funds authorized under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) of 2010, and provides a third round of neighborhood stabilization grants to all states and select governments on a formula basis.
"Deltona has kept a narrow focus of its NSP activities, primarily operating the purchase of foreclosed homes in disrepair, home rehabilitation and home sale program," Mr. Lopez wrote in an emailed response to questions.
The city bought two vacant lots and constructed new homes on them, bought other properties, demolished the existing structures and built new homes on the sites in addition to partnering with Habitat for Humanity for two homes, he explained.
By 2011, one in 17 Deltona homes was in foreclosure, according to Google Maps Foreclosure Listings.
"Because Deltona was so hugely residential, properties were devalued 22 percent over three years," said Deltona Commissioner Heidi Herzberg.
"Everybody expected Deltona to fail," she added referencing the NSP.
Commissioner Herzberg is very proud of what the city has accomplished through its participation in the program.
The NSP may have seemed like bringing a pellet gun to a nuclear war but the city had to do something. Sometimes you just start where you are. Before you know it you've chipped away at enough of a problem that it becomes less of one.
"We consider the program to be very successful in the community by helping families and individuals become homeowners," Mr. Lopez wrote.
The program's prospective clients want stable, affordable housing and the removal of blighted homes improves neighborhoods, he noted.
Positive feedback from purchasers, meeting program deadlines and adhering to program guidelines has clinched Deltona's success.
"The award of the NSP 3 program to the city, we believe, showed confidence that we were operating the program as directed from HUD," Mr. Lopez added.
The city may be being recognized for more than just procedure following. It could be helping to set the bar nationwide.
"We don't have any kind of definite confirmation, but we were told from our HUD Consultant that they liked our Operations and Procedures Manual so much that they were recommending it to other communities to be used as a template for their housing operations," Mr. Lopez mentioned.
In its first and second years with the NSP, Deltona procured homes and land, readying properties to be placed on the market for sale.
Half of those were sold in the third year, Mr. Lopez reported, adding the sales pace for the remaining units has been "fairly steady."
"We only have one remaining home in the NSP 1 original grant to sell," he noted.
Deltona continues to buy, rehabilitate and sell homes under Program Income -- received by a participating jurisdiction, state recipient, or sub recipient directly generated from the use of HOME funds or matching contributions -- keeping the program "constant and dynamic with an open-ended deadline until project closure," according to Mr. Lopez.
Mike Williams, a Deltona resident and Realtor with RE/MAX Associates loves working with first-time homebuyers.
It can be stressful, emotional and challenging overall, but Mr. Williams is seasoned. He's found the rewards substantially more in supply than headaches.
His company was designated by the commission to handle transactions under the NSP from the start.
"The responsibilities we had as Realtors ... once the city identified a property in foreclosure, they'd ask us to make an offer," Mr. Williams said. "We'd make an offer on behalf of the city and they'd buy the properties and rehab them."
On average, Mr. Williams said, Deltona spent around $45,000 to renovate the ones that could be salvaged.
He said the average sales price of a home under the NSP is around $65,000 to $70,000.
"There is no question there are many fewer (empty) homes than there were a few years ago and the NSP has helped in that regard," Mr. Williams said. "We're one of the better performing jurisdictions in the state of Florida."
"The worst time for excessive numbers of vacant properties probably was after 2008 and through 2010 or 2011," he said. "From then to now there's been a substantial reduction."
"Based on RealtyTrac, there were approximately 1,700 homes in foreclosure at the end of 2013," Mr. Lopez noted, adding, "That is an 18 percent reduction from 2012."
On the purchase side, working with the banks has been fairly seamless, Mr. Williams said.
"It can be difficult getting loans for buyers because many (banks) don't want to do small loans," he explained. "Many have been done by mortgage companies. The biggest challenge is putting the very low income buyer in these homes and the program mandates 25 percent (of funds) must be for very low income buyers."
Low income as defined by HUD pertains to individuals at or below 50 percent of the area median income.
He mentioned another impediment.
"Still the big problem after all these years is awareness," Mr. Williams said. "People don't know about this program."