State Seeks to Turn REOs into Affordable Housing
State Seeks to Turn REOs into Affordable Housing
The New Jersey state senate recently approved a bill that would would allow towns and a state-created corporation to buy vacant foreclosed homes and resell or rent the properties out as affordable housing units. The bill received Senate approval Monday and still needs to be approved by the governor to made final.
The bill calls for the formation of the New Jersey Foreclosure Relief Corp., which for the next five years would be able to purchase, sell, and rent foreclosed properties in the state.
The program would work by allowing municipalities first dibs, giving them 45 days to decide whether to purchase a foreclosed home using the state’s $268 million affordable housing trust fund. If they opted not to purchase the home, the New Jersey Relief Corp. could step in, issuing bonds to buy and sell the vacant home at market rates.
Municipalities will receive double affordable housing credits for the number of homes that they rent out under the program.
Source: “New Jersey Passes Bill to Reuse Vacant Foreclosures,” HousingWire (June 25, 2012) and “N.J. Foreclosures Could Become Affordable Housing,” The Associated Press (June 26, 2012)
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