The city of Visalia will be putting $120,000 towards first time homebuyers, eligible homes for funding are being constructed on Northwest Fifth and North Court Avenue
VISALIA – With the housing market at an all time high, Visalia City Council gets creative with first time homebuyer assistance funds.
At their April 3 city council meeting, there was a public hearing over the remaining funds in the city’s Neighborhood Stabilization Program 1 (NSP). The NSP grant was distributed years ago to assist communities with their high rates of abandoned and foreclosed homes. This grant, however, is now almost fully expended, and council is reallocating the remaining funds to help first time homebuyers. The remaining funds are roughly $120,000, and it will go towards five single family homes that are currently being constructed on Northwest Fifth and North Court Avenue.
“I’m eternally grateful for these programs. I used a first time homebuyer program when I purchased my first home and we lived there for 10 years,” vice mayor Brett Taylor said.
Through the reallocation of these funds, the city is proposing to provide first time homebuyers with assistance as a deferred 30-year secondary financing, with zero interest. This funding will also use the Home Investment Partnerships Program (HOME) funds, which is a federal block grant that creates more affordable housing for low-income areas. Since these five homes are being funded with HOME funds, if they’re not sold to an income eligible homebuyer within nine months of construction, they must be rented to low-income tenants. The city would then be the landlord for a 45 year period. Eligible homebuyers for this program are those who have not owned a home for three years or more.
The NSP Grant was originally received in 2008, and it was established due to the foreclosures that were happening at that time. However, the housing market has changed, and the reallocation of money would put these funds towards those needing to buy a home outside of foreclosures. According to staff documents, the ability to make offers on foreclosed homes is limited, unlike it was when this grant first came into being. Only three property types can receive NSP assistance or funds, and those are foreclosed properties, abandoned properties or development of vacant land.
This comes after residents voiced their concerns over Visalia’s housing crisis in a survey that the city created last November. Survey results indicated that 64% respondents believe the city needs more affordable homes available for purchase. The answer tied with the need for emergency, transitional and supportive housing for those who need it.
Additionally, 67% of respondents said the largest barrier to accessing housing in Visalia is few options for rent or sale, with cost of rent coming in second at 58%. Also, 58% of respondents said they are open to the idea of new housing in their own neighborhoods to address the housing shortage in the city.