Stimulus funds bring a house back to life

Bernard Hawkins said that when his development company examined the then-foreclosed house on 56th Street near Poplar, it was full of personal belongings such as family photographs.

"We assume the previous owner of the property died, based on the conversations we had with the neighbors," said the executive director of Philadelphia Neighborhood Housing Services.

After a major renovation costing about $100,000, including new heating and plumbing, new windows and a tankless hot water heater, the house in the Carroll Park section of West Philadelphia is alive and ready to be sold.

City officials gathered at the front of the house yesterday morning to dedicate the renovations, made possible by the $20 million stimulus-funded Neighborhood Stabilization Program (NSP1).

The city received the NSP1 stimulus funding in January 2009. It received $16 million from the Department of Housing and Urban Development and $4 million from the state's stimulus share.

"There were some places that had really extensive foreclosure problems, like Cleveland, that had to use the NSP1 money to demolish houses," said Terry Gillen, executive director of the Redevelopment Authority.

Gillen said the RDA, which oversees the program, gives a developer a loan for the purchase and renovation cost of a property, selected from neighborhoods with high foreclosure rates. The loan is forgiven once the house is sold, and developers also get $20,000 in stimulus funds for each home sold.

The nearly $100,000 in renovations to the house on 56th Street is typical, she said. Philadelphia Neighborhood Housing Services is selling the house for $90,000, which Gillen said is about average. She also said prices vary by neighborhood.

David Bartelt, a Temple University professor of geography and urban studies, said vacant and abandoned properties have a degrading effect on the value of nearby properties. He said that the program could prevent that but that it's hard to tell at this point.

"It can help, but it's at such a relatively small scale compared to the volume of foreclosures going on," he said. "The hope is that you forestall the worst effects."

Gillen said there have been about 7,000 foreclosures per year in Philadelphia. "We're grateful to the federal government for providing this money . . . and we will keep doing the program for as long as we can," she said.