City of Boston Thomas M. Menino, Mayor

1
BOSTONS ANTI FORECLOSURE STRATEGY
City of BostonThomas M. Menino,
Mayor Department of Neighborhood
DevelopmentEvelyn Friedman, Chief and Director
2
BOSTONS ANTI FORECLOSURE STRATEGY
Strategy Components PREVENTION INTERVENTION RE
CLAMATION
3
BOSTONS ANTI FORECLOSURE STRATEGY
PREVENTION INTERVENTION RECLAMATION
4
PREVENTION
1999 Dont Borrow Trouble
5
PREVENTION
6
PREVENTION
Residential Foreclosures in Boston 1990-2007
7
BOSTONS ANTI FORECLOSURE STRATEGY
PREVENTION INTERVENTION RECLAMATION
8
INTERVENTION
Boston Home Center Foreclosure Prevention Transit
Ads, 2006
9
INTERVENTION
Foreclosure Prevention Assistance
Mayor Menino With Foreclosure Prevention Client
At Servicers Workshop
10
INTERVENTION
Impact of Foreclosure Prevention on Overall
Foreclosure Rate
11
BOSTONS ANTI FORECLOSURE STRATEGY
PREVENTION INTERVENTION RECLAMATION
12
RECLAMATION
Neighborhood Impacts of Foreclosures
PROJECTED FORECLOSURE IMPACTS, 2008
13
RECLAMATION
Foreclosures Deeds By Property Type 2008 through
9/15
Condominiums Stock 18 Deeds 25
1-Family Stock 12 Deeds 10
2-Family Stock 14 Deeds 22
3-Family Stock 18 Deeds 40
All Other Property Types Stock 38 Deeds
3
14
RECLAMATION
Bank-Owned Homes in Boston September 2008
982 0.8 of Bostons 1-4 Condo Housing Stock
15
RECLAMATION
PHYSICAL CONDITION OF BANK-HELD PROPERTIES IN
BOSTON
As of July 2008, Includes 857 of 936 REO
Properties
16
RECLAMATION

• 3-Part Strategy
• Targeted Action In Hot Spots
• Distressed Property Redevelopment
• Homebuyer Strategy

17
RECLAMATION 1. Targeted Action in Hot Spots
Mayor Menino surveys foreclosed homes in Hendry
Street neighborhood
18
RECLAMATION 1. Targeted Action in Hot Spots
19
RECLAMATION 2. Distressed Property Redevelopment
21 Hendry Street
20
RECLAMATION 2. Distressed Property Redevelopment
Homeownership Path City Acquisition Model
City Negotiates Single or Bulk purchases from
lenders
City transfers acquisition rights to
pre-qualified developers
Rapid one-stop gap funding investment by City (if
needed)
Developer completes renovation markets at
agreed-upon price to homebuyers
Sale to homebuyer.
21
RECLAMATION 2. Distressed Property
Redevelopment Federal Funding Role
Homeownership Path City Acquisition Model
City Negotiates Single or Bulk purchases from
lenders
City transfers acquisition rights to
pre-qualified developers
Rapid one-stop gap funding investment by City (if
needed)
Developer completes renovation markets at
agreed-upon price to homebuyers
Sale to homebuyer.
22
RECLAMATION 2. Distressed Property Redevelopment
City Acquisition
11 Coleman Street City negotiated price of
30K/unit, Rights now transferred to
Contractor-Developer
23
RECLAMATION 2. Distressed Property Redevelopment
Homeownership Path Private Acquisition Model
Developers and NPOs are pre- qualified for State
acquisition loan fund
Developers purchase properties using State loans,
staying within HUD price limits
Rapid one-stop gap funding investment by City (if
needed)
Developer completes renovation markets at
agreed-upon price to homebuyers
Sale to homebuyer.
24
RECLAMATION 2. Distressed Property
Redevelopment Federal Funding Role
Homeownership Path Private Acquisition Model
Developers and NPOs are pre- qualified for State
acquisition loan fund
Developers purchase properties using State loans,
staying within HUD price limits
Rapid one-stop gap funding investment by City (if
needed)
Developer completes renovation markets at
agreed-upon price to homebuyers
Sale to homebuyer.
25
RECLAMATION 2. Distressed Property Redevelopment
Affordable Rental Path
26
RECLAMATION 2. Distressed Property
Redevelopment Federal Funding Role
Affordable Rental Path
Prequalified developer gets property from City
with approval for affordable rental housing
Property sold with affordability covenants to
qualified rental operator
Rehab work completed
Property retained by developer with affordability
covenants
Developer privately acquires REO property
27
RECLAMATION 3. Homebuyer Strategy
Distressed REO Inventory September 2008
Distressed 31
Fair-Good 69
Mayor Menino welcomes would-be homebuyers to the
REO Trolley Tour
28
RECLAMATION 3. Homebuyer Strategy
Marketing Materials For Workshop On How To Buy
a Foreclosed Property
29
RECLAMATION 3. Homebuyer Strategy
Acquisition/Rehab
30
RECLAMATION 3. Homebuyer Strategy
Acquisition/Rehab Use of Federal Funds
Homebuyer participates in REO tour and identifies
properties of interest. Completes training
workshop
City provides rehab analysis before offer made.
31
CHALLENGES AHEAD

• Neighborhood Stabilization Investment not
  Eligible for Federal Funding
• Availability of Credit
• Engaging Good Developers Contractors
• Servicer Cooperation

32
BOSTONS ANTI FORECLOSURE STRATEGY
City of BostonThomas M. Menino,
Mayor Department of Neighborhood
DevelopmentEvelyn Friedman, Chief and Director