WASHINGTON, DC — The U.S. Department of Housing and Urban Development (HUD) and New York City have announced a five-year plan to preserve affordable housing for 1,500 families that “have fallen prey to unscrupulous lenders and nonprofit organizations in Manhattan, Brooklyn, Queens, and the Bronx.” In addition, HUD and the city will invest nearly $168 million to rehabilitate more than 500 properties as part of the city's overall revitalization efforts in these neighborhoods.

The plan specifically addresses the 514 multi-family properties that were sold under HUD's 203(k) mortgage insurance program. The properties were sold to 54 nonprofit organizations in 1998 and 99, generally at inflated prices, says HUD. Most of the properties involved are currently in or at risk of default.

Under this plan, HUD will acquire these properties upon foreclosure and work with the city's Department of Housing Preservation and Development (HPD) to restore, market, and sell the properties through programs modeled after successful, existing city programs.

“HUD's and the city's priority is to revitalize these areas while maintaining a market that does not put the housing beyond the reach of middle- to low-income renters and property owners,” said HUD Secretary Mel Martinez. “We believe this comprehensive, community-oriented approach can accomplish both while repairing 2,200 housing units, which help more than 1,500 families currently living in the properties to keep their homes throughout this process.”

Publication date: 01/07/2002