NYC Department of Housing, Preservation and Development has begun implementing it’s plan to use the $24 million dollars received from the U.S. Department of Housing and Urban Development as part of the the Housing and Economic Recovery Act of 2008.
As indicated in the video, the city purchased 7 properties in neighborhoods hard hit by the sub prime foreclosure crisis.
In one of my first blog posts on this subject, Mayor Bloomberg’s Plan to Avert Urban Blight, I raised a number of concerns that didn’t appear to be addressed in the city’s action plan.
However, after watching the above report by Ruschell Boone of NY1, I have more concern to add to the list;
Where did the city get the extra $35 million dollars?
If you recall, the city received $24 million from HUD and now have $59 million to work with. I guess if I were in public school this would be considered the new math. With the current budget agreement between the Mayor and City Council, I couldn’t figure out where the money came from.
In addition, while the plan is designed to stabilize neighborhoods experiencing high rates of foreclosure, the city is also experiencing an alarming rise in homelessness.
And it doesn’t have the traditional appearance you’re accustomed to seeing. You know the site; the vagrant begging for change or food in the subways, busy street intersections or fast food drive thru windows. Many of them go to work 5, sometimes 7 days a week and are raising small children. They’re affectionately referred to as the working poor.
What neighborhoods do you think the recent additions amongst the homeless ranks will originate from? If your answer is neighborhoods hit hardest by the foreclosure crisis, you’d be considered smarter than a 5th grader.
Just take a look at the figures provided in the table below to see how and where the next wave of homelessness will originate.
Of the top 20 neighborhoods with the greatest needs, 5 are in central Brooklyn (Bedford Stuyvesant, East New York, Canarsie, Bushwick and East Flatbush).
The only borough that HPD has not made a purchase in as of this post date, and has been reported in the above video, is Brooklyn. Upon careful examination you’ll note the following:
According to the above table, Bedford Stuyvesant, Bushwick and East New York sub prime loan volume were 1,427, 966 and 2,106 respectively. However, their Lis Pendens filings were 1,337, 732 and 1,557.
There appears to be a higher rate of initial foreclosure filings in Bedford Stuyvesant (93%), Bushwick (76%) and East New York (74%) than there were in East Flatbush (59%) or Canarsie (51%).
Currently, Bedford Stuyvesant, Bushwick and East New York are experiencing a dramatic increase in sales of existing homes. For every 8 sales recorded in all 3 neighborhoods over the first 6 months in 2009, 5 were distressed sales resulting from foreclosure filings.
It also bears mentioning that Bedford Stuyvesant, Bushwick and East New York are neighborhoods located along major subway lines in the city (A,C and J trains) and are already experiencing improvements in their standard of living as a result of major real estate Initiatives/developments (Gateway Mall, Atlantic Avenue Shopping Center and LIRR Atlantic Avenue Transportation Hub), as well as the highest concentration of newly constructed public schools in the city.
The major players of the current sales activity in Bedford Stuyvesant, Bushwick and East New York have been real estate investors that are either flipping properties for substantial profits or rehabilitating properties with high retail mark up prices.
And from all reports…the foreclosure business appears to be good, just click on the links below and find out.
How Profitable Can The Foreclosure Crisis Be?
How Profitable Can The Foreclosure Crisis Be? Act II
* This post originally appeared at http://mybrooklynreport.wordpress.com/2009/06/23/the-foreclosure-business-nyc-59-million-plan/
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