Kane-Elgin HOME group wants to address more affordable housing
Continuing the attack on foreclosed homes and seeing Elgin’s ArtSpace project through to construction will be the focus of Kane County’s and Elgin’s joint allotment of federal dollars targeted at affordable housing.
The Kane-Elgin HOME Consortium Thursday recommended a $1.25 million budget for the 2011 program year, which begins June 1. But that money is uncertain since the federal government has yet to establish a budget. The expectation is a $175 million cut in what’s known as the HOME Investment Partnerships Program. That 9.5 percent reduction from the previous year works out to about $725,000 in funding for the Kane-Elgin program.
Like the federal dollars, the balance of the $1.25 million budget is on shaky ground as well. It relies on receiving income from the sale of foreclosed homes the county has remodeled using federal dollars.
Josh Beck helps oversee the county’s foreclosure remodeling program and said the housing market is still down.
“The people I’ve talked to said the end of the year (2010) was the worst they’ve ever seen,” Beck said. “But just now some homebuyers are talking about trying to beat the market before it comes back up. We’re seeing more activity.”
But activity doesn’t necessarily translate into home sales. Much of that turnaround depends on the ability of buyers to secure favorable loans even as their income has sagged, Beck said. A 5 percent interest rate is key to buyers.
“For many people, if that interest rate hits 5.75 and 6 percent, they won’t be able to afford to buy a house any more,” Beck said.
Being able to afford to keep a home is the other side of the coin. The Kane-Elgin program is looking to purchase and rehab at least a couple more foreclosed homes this year. Scott Berger, who monitors area foreclosures for Kane County’s Office of Community Reinvestment, indicated it’s still an uphill battle.
“We are still seeing between 70 and 110 new foreclosure cases filed in Kane County every week,” Berger said.
Much higher on the scale of success in the eyes of the Kane-Elgin HOME Consortium is Elgin’s ArtSpace project on Spring Street. The consortium is kicking in $750,000 to see the 55-unit affordable housing space for area artists come to life. Consortium members reported Thursday all letters securing funding for the project are in place. Closing on the land is expected to occur no later than July 30.
Other funds for the 2011 project year will go toward ongoing efforts by Community Contacts for the rehabilitation of owner-occupied housing. Another $175,000 will provide money to help qualified first-time homebuyers with down payment and closing cost assistance.