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U.S Department of Housing and Urban Development U.S. Department of the Treasury Spotlight on the Housing Market in Atlanta-Sandy Springs-Marietta, Georgia Spotlight on the Housing Market in Atlanta-Sandy Springs-Marietta, Georgia The Obama Administration's Efforts to Stabilize the Housing Market and Help American Homeowners - November 20 The Atlanta-‐Sandy Springs-‐MarieSa, Georgia Metropolitan Sta=s=cal Area (Atlanta MSA) includes 28 coun=es in northwest Georgia, including the ﬁve co and GwinneS. Although the share of distressed mortgages in the Atlanta MSA has been above the na=onal average since mid-‐2000, the local foreclosur na=on as a whole, with delinquencies and defaults rising signiﬁcantly in 2007, as in other regions where there were many high-‐cost subprime loans . Ho house price growth than the na=on during the early part of the decade; yet, local home prices have subsequently fallen by nearly as great a percentage property values in Atlanta and the extent of underwater mortgages in the current market were fueled in part by rising defaults but also by excess housin increased rental vacancies, caused aggressive home sales pricing, and contributed to eventual price declines. The housing market in Atlanta remains frag mortgages, deeply-‐discounted foreclosed proper=es, low property values, and many severely underwater mortgages. However, the Administra=on’s br market has been a source of real help to homeowners in Atlanta and surrounding ci=es. This addendum to the Administra=on’s housing scorecard prov the local economy and the impact of the Administra=on’s eﬀorts to stabilize the housing market and help local homeowners. U.S. Department of Housing and Urban Housing Market and Policy Development and Research The Obama Administration’s Eﬀorts to Stabilize TheDevelopment | Office of Help American Homeowners | November 2011 Population Growth, Employment, and Housing Market: The Atlanta-Sandy Springs-Marietta, Georgia Metropolitan Statistical Area (Atlanta MSA) includes ﬁve core counties (Clayton, Cobb, DeKalb, Fulton, Population Has I days The Although the share popula=on count o 5.27 million for in tlanta around Atlanta and Gwinnett) and 23 other counties in northwest Georgia. most recent decennial Census of distressed f mortgagesthe Aand MSA indicates that the – those 90 or morencreased in Atlanta Dur popula=on increased by an average of approximately 102,000 people, or 2.4percent a year, over the past delinquent, in foreclosure, or bank owned – has been above theuring this =me, average f 55,000 pmid-2000, theo local foreclosurethe most has generally mirrored national an average o since eople a year moved t the area. Migra=on was crisis decade. D Date rapid from 2005 and 2007 when n average f 62,000 jobs year were added. Popula=on growth that of the nation as a whole, with a signiﬁcant rise in delinquencies through defaults aamong osubprimea loans beginning in 2007. During the4/1/00 part Atlanta M SA P opulation early 4,247,63 peaked in 2 of the decade, local home prices grew at a slower pace than the006 but has since slowed to less than half that level. prices in the MSA have since fallen 4/1/10 national average; however, home by nearly as 5,268,86 Source: Census Bureau (2000 and great a percentage as in the rest of the country. Declining property values in Atlanta and the extent of underwater mortgages in the current market 2010 Decennial) were fueled in part by rising defaults but also by excess housing construction in the years prior to the crisis – which also increased rental vacancies n the Housing Market in Atlanta-Sandydeclines. The housingGeorgia through 2010, payrolls in the Atlanta MSA declined by 194,000 jobs from the of distressedomortgages, deeply- to lose jobs. Empl and contributed to eventual price Springs-Marietta, market in Atlanta remains fragile - with a high percentage 2007 annual peak f 2.45 million. The area con=nues From 2008 during the t severely 2011 compared mortgages. f 2010. Employment in the na=on increased by remains a barrier discounted foreclosed properties, low property values, and manyhird quarter of underwaterto the third quarter oAccess to available credit also 1.0 percent during the same period. More than the past y November 2011 t The Obama Administration's and existing homeowners. However, the Administration’s broad ﬁnancial ac=vi=es sector (11,300) and in construc=on (7,000), primarily as been of csourceweakness in the local housing mark for potential Efforts to Stabilize the Housing Market and Help American Homeownersin ear occurred in ahe uapproach manufacturing (4,200), and professional and business services (2,200), but were oﬀset by a decline in the governm to stabilizing the housing market has a result a on=nued of real growth transporta=on nd =li=es (4,400), ngs-‐MarieSa, Georgia Mto homeowners rea (Atlanta MSA) includes 28 coun=es in northwest Georgia, including the ﬁve to the uts. During the third quarter of 2011, the average unemployment rate for the Atlanta MSA was 10.1 percent, down slightly from 1 ta=s=cal A in Cobb, D ulton, related l j coun=es help etropolitan Sin the Atlanta MAtlanta and surrounding cities. id-‐2000, addendum core ob c has gof Clayton, irrored teKalb, tFhe Housing Scorecard provides a summary of This the ocal gfovernment crisis Obama Administration’s h the share of distressed mortgages SA has been above the na=onal average since m local oreclosure enerally m hat of average unemployment rate during trends and conditions2in thein local egions where there were many high-‐cost subprime loans . However, the Attlanta MSA eto stabilize the own from 9.6 market and help local homeowners. economy and the impact of the Administration’she same period was 9.1 lpercent, d housing percent. efforts xperienced ower delinquencies and defaults rising signiﬁcantly in 007, as other r n the na=on during the early part of the decade; yet, local home prices have subsequently fallen by nearly as great a percentage as those for the rest of the na=on. Declining nta and the extent of underwater mortgages in the current market were fueled in part by rising defaults but also by excess housing construc=on prior to the crisis. The laSer ies, caused aggressive home sales pricing, and contributed to eventual price declines. The housing market in Atlanta remains fragile -‐ with a high percentage of distressed ounted foreclosed proper=es, low property values, and many severely underwater mortgages. However, the Administra=on’s broad approach to stabilizing the housing ce of real help to homeowners in Atlanta and surrounding ci=es. This addendum to the Administra=on’s housing scorecard provides a summary of trends and condi=ons in the impact of the Administra=on’s eﬀorts to stabilize the housing market and help local homeowners. Job Market Conditions Remain Weak for Atlanta Population Growth, Employment, and Housing Market: While Improving for the Nation Quarterly Nonfarm Employment According to the most recent Census, the Atlanta MSA has a 2,600 population of 5.27 mployment, and Housing Market: million which has increased by an average 2,500 of approximately 102,000 people (2.4 percent) Population Has Increased in Atlanta During the Past Decade each year sus popula=on count of 5.27 million for the Atlanta MSA indicates that the since 2000 – including an average of 55,000 new residents rage of approximately 102,000 people, or 2.4percent a year, over the past 2,400 Annual Growth Rate From erage of 55,000 people a year moved the area. igra=on was the was the most rapid between that moved to to the area. M Migration most Date Atlanta MSA Population Prior Date when an average of 62,000 jobs a year were added. Popula=on growth -‐ 4/1/00 2005 and 2007 when an average of 62,000 jobs a year were 4,247,636 2,300 owed to less than half that level. 4/1/10 2.4% added. Population growth peaked at 160,000 Census Bureau (2000 and 2010 Decennial) in 2006 but 5,268,860 Source: 2,200 has since slowed to less than half that level. Household growth averaged 2.5 percent annually between 2000 and 2010, 2,100 olls in the Atlanta MSA declined by 194,000 jobs from the growth at eak of 2.45 million. The area con=nues to lose jobs. Employment fell by 26,000 jobs, or 1.1 percent, but net annual housing unit 2007 annual p 3.2 percent exceeded 1 compared to the third quarter of 2010. Employment in the na=on increased by 1.0 percent during the same period. More than half of the job losses in the Atlanta MSA over corresponding population and household growth rates. nancial ac=vi=es sector (11,300) and in construc=on (7,000), primarily as a result of con=nued weakness in the local housing market. Employment sector gains included Year and Quarter Household Growth During the Past Decade Date of Census 4/1/2000 Atlanta MSA Population 4,247,636 1,937,225 2.5% 130 125 120 Na=on (right axis) 1,644,572 Annual Growth Rate - Unemployment Rate Remains Stubbornly High Monthly Unemployment Rate (Percent) 150 3.2% 145 12 10 2,165,495 Source: Census Bureau (2000 and 2010 Decennial) with 2000 Data Adjusted to 140 Reﬂect 2010 MSA Deﬁnition. 135 130 Millions Atlanta MSA Housing Units 2.4% From 2008 through 2010, Atlanta and surrounding cities lost a total of 194,000 jobs —and the area continues to shed jobs. 125 While employment in the U.S. increased by 1 percent in the 120 third quarter of 2011 from a year earlier, local employment in Atlanta fell by 26,000 jobs, or 1.1 percent, during the same Year and Quarter period. More than half of job losses in the Atlanta MSA over Atlanta MSA Na=on (right axis) the past year were from the ﬁnancial services sector (11,300) Seasonally Adjusted Data and construction (7,000), primarily as a result of continued Source: Bureau of Labor Sta=s=cs 8 6 4 2 0 Seasonally Adjusted Data Source: Bureau of Labor Sta=s=cs Spotlight on Atlanta MSA | Page 1 Atlanta MSA Na=on Millions 135 5,268,860 Annual Growth Rate Job Market Conditions Remain Weak for Atlanta Atlanta MSA Households 1,554,154 While Improving for the Nation Annual Growth Rate Employment Quarterly Nonfarm 10 140 Source: Bureau of Labor Sta=s=cs 4/1/2010 12 145 Thousands =li=es (4,400), manufacturing (4,200), and professional and business services (2,200), but were oﬀset by a decline in the government sector (12,700) as a result of budget-‐ uts. During the third quarter of 2011, the average unemployment rate for the Atlanta MSA was 10.1 percent, down slightly from 10.2 percent a year earlier. The nAtlanta MSA a=onal Atlanta Housing Unit Growth uring the same period was 9.1 percent, down from 9.6 percent. Outpaced Population and Seasonally Adjusted Data 150 8 6 4 2 0 reports that 35 percent of mortgages in the Atlanta MSA are currently in negaCve equity compared with 23 percent naConally -‐ represenCng addiConal homeowners and loans potenCally at risk. U.S Department of Housing and Urban Development U.S. Department of the Treasury Fo Area Atlanta MSA Nation Note: Foreclosure Rate Data through S Source: Realty Trac and U.S. Department of Housing and Urban Housing Market and Policy Development and Research The Obama Administration’s Eﬀorts to Stabilize TheDevelopment | Office of Help American Homeowners | November 2011 weakness in the local housing market. Also, there was a decline in government sector jobs (12,700) as a result of state and local budget cuts. The local economy added jobs in transportation and utilities (4,400), manufacturing (4,200), and professional and business services (2,200). The average unemployment rate for the Atlanta MSA was 10.1 percent in the third quarter of 2011, down slightly from 10.2 percent a year earlier. The national average unemployment rate during the same period was 9.1 percent, down from 9.6 percent. Home sales in the Atlanta MSA remain sluggish, with existing home sales on the decline since 2006 and new home sales declining since 2005. During the ﬁrst eight months of 2011, existing home sales fell by 13 percent compared to the ﬁrst eight months of 2010, while new home sales fell by 29 percent, according to CoreLogic. The high proportion of distressed sales, which currently represents 39 percent of all existing home sales in the Atlanta market and is well above the national rate of 27 percent – has weakened Atlanta home prices overall. The CoreLogic repeat-sales house price index shows that home Spotlight on the Housing Market in Atlanta-Sandy Springs-Marietta, Georgia prices in Atlanta rose at just one-third the national Spotlight on the Housing Market in Atlanta-Sandy Springs-Marietta, Georgia pace between 2000 2006 2005. een on the decline since and and new Although home prices in Atlanta did not 011, exisCng home ate as 006 and new in much of the nation, prices nonetheless been on the decline since 2 by 13 did inﬂsales fell they e sales fell by 29 percent, according 3 f 2011, exisCng home sales fell by 1 to declined 24 percent from their peak in December 2006 to their urrently represent 39 percent of all to me sales fell by 29 percent, according al rate of 27 percent. in ercent of a2009, nearly as high as the national average low 9 p March ll currently represent 3The high proporCon Logic repeat-‐sales house price index onal rate of 27 percent. The high proporCon 31 percent. Home prices in Atlanta peak-to-low decline of etween repeat-‐sales house price index reLogic 2000 and 2005. Although home have shown signs of h of the naCon, prices nonetheless e between 2000 and 2005. Although home rebounding since early 2009, but they March the naCon, prices nonetheless ch of 2009, nearly as high at tlow levels not seen in more than a decade. The remain as he naConal e shown signs of rebounding since early n March 2009, nearly as high as the naConal rental market in Atlanta is showing signs of improvement, but anta is showing of rebounding since early ave shown signs signs of improvement, erall apartment like thef sales market, it remains fragile. According to Reis Inc., vacancy r improvement, Atlanta is showing signs oate in Atlanta year earlier but well above the n Atlanta overall apartment vacancy rate apartment vacancy rate in Atlanta was 8.4 percent the overall inaConal ia year earlier bpercent fbove t he naConal ncreased by 2 ut well a rom a year ago during the same pthe third a year ago in ercent nts increased by 2period. from quarter of 2011, down from 10.6 percent a year 60 during the same period. well above the national average of 5.6 percent. earlier but During the third quarter of 2011, average rents increased by 2 percent from a year ago to $860. The average rent nationwide increased by 2 percent to $1,060 during the same period. New and Existing Home Sales: Atlanta Compared to the Nation Annual Home Sales (thousands) 160,000 8,000 140,000 7,000 120,000 6,000 100,000 5,000 80,000 4,000 60,000 3,000 40,000 2,000 20,000 1,000 0 2003 2004 2005 2006 2007 2008 2009 2010 NaCon: ExisCng Sales (right axis) NaCon: New Sales (right axis) Atlanta MSA: ExisCng Sales 0 Atlanta MSA: New Sales Sources: CoreLogic, HUD/Census Bureau, and NaConal AssociaCon of Realtors Atlanta Home Prices Declined Sharply After Relatively Modest Rise Market Remains Fragile Atlanta Home Prices Declined Sharply After Relatively Modest Rise Repeat-‐Sales House Price Index (Fragile = 100) Market Remains Jan 2000 Repeat-‐Sales House Price Index (Jan 2000 = 100) 220 220 200 200 180 180 160 160 140 140 120 120 100 100 80 80 Trends in Mortgage Delinquencies and Foreclosures: Homeowners in Atlanta are still struggling with high levels of mortgage delinquency and foreclosure, although conditions have improved since February 2010. As of September 2011, the Atlanta metro area ranked 73rd out of 366 metropolitan areas for the percentage of mortgages at risk of foreclosure (90 or more days delinquent or in the process of foreclosure) according to LPS Applied Analytics. Through the efforts of numerous state and local entities in partnership with the federal government, the number of mortgages at risk of foreclosure in the Atlanta area declined from approximately 73,500 (8.7 percent of all mortgages) in September 2010 to 65,100 (7.5 percent) in September 2011, compared with a national decline from 7.3 to 6.9 percent. CoreLogic data since 2000 show that the share of mortgages 90 linquency and foreclosure, although d 73 out of 366 or more days delinquent, which includes loans in the foreclosure moreclosure, although delinquency and fetropolitan areas for quent oout ohe 66 metropolitan areas for process or bank ked 73 r in t f 3 process of foreclosure) owned, has been consistently higher in Atlanta nquent or inCCes irocess of foreclosure) and local e n the p n partnership with the than in the nation. Since its January 2010 high of 10.7 percent, e Atlanta area nCCes in prom te and local e declined f artnership with the the rate of mortgages 90 or more days delinquent has fallen o 65,100 (7.5 percent) in Sfeptember 2011, he Atlanta area declined rom since 2000 7.5 percent) in hare of national rates declined from 8.5 percent to to 8.9 percent; to 65,100 (show that the sSeptember 2011, higher in Atlanta than in the naCon. a since 2000 show that the share of 7.2 percent. over tes igher in Atlanta .9 percenthis the same period. Realty Trac data show that have fallen to 8 than in the T aCon. ly h n same period. Ralthoughata show that ealty Trac d the rates have fallen to 8.9 percent. Tforeclosure rate in Atlanta remains higher than in his has improved. Completed foreclosures he same period. Realty Trac data show that shows improvement for the most part since during the ﬁrst the nationooverall, it nine months f 2011, so has improved. Completed foreclosures ns locally and naConally. CoreLogic 00 during the ﬁrst nine months of 2011, negaCve equity compared wCoreLogic ons locally and naConally. ith 23 percent risk. n negaCve equity compared with 23 percent t risk. Atlanta MSA Source: CoreLogic NaCon Atlanta MSA Source: CoreLogic NaCon Rental Vacancy Rates Consistently Higher an Nation Quarterly Apartment Consistently Higher an Rental Vacancy Rates Rental Vacancy Rates (Percent) Nation Quarterly Apartment Rental Vacancy Rates (Percent) 13.0 13.0 12.0 12.0 11.0 11.0 10.0 10.0 9.0 9.0 8.0 8.0 7.0 7.0 6.0 6.0 5.0 5.0 Year and Quarter Source: Reis Inc. Source: Reis Inc. Year and Quarter Atlanta MSA NaCon Atlanta MSA Spotlight on Atlanta MSA | Page 2 NaCon Share of Distressed Mortgages Higher anof Distressed Mortgages Share the Nation, But Declining Mortgages 90+ Days Delinquent Nation,of All AcCve Mortgages) Higher an the (Percent But Declining 8.0 7.0 U.S Department of Housing and Urban Development 6.0 U.S. Department of the Treasury hough areas for closure) ip with the mber 2011, e of aCon. This a show that eclosures f 2011, Logic h 23 percent 5.0 Year and Quarter Source: Reis Inc. Atlanta MSA the third quarter of 2010. Foreclosure completions declined from 30,400 during the ﬁrst nine months of 2010 to 27,700 during the ﬁrst nine months of 2011, although lender process reviews continue to affect foreclosure completions locally and nationally. CoreLogic reports that 35 percent of mortgages in the Atlanta MSA are currently underwater Atlanta MSA Foreclosure Completion Rates in the – compared to 22 Third Quarter additional homeowners009 Since April 1, 2 and percent nationally - representing 2011 Foreclosure Foreclosure Foreclosure Foreclosure Area loans potentially at risk. Completions Rate Completions Rate Atlanta MSA 11,100 0.5% 92,800 4.3% Foreclosure Completion Rates in the Atlanta MSA 1.8% Nation 196,500 0.2% 2,332,100 Note: Foreclosure Rates as Percent of All Housing Units; Third Quarter 2011 Since April 1, 2009 Data through September 2011 for Foreclosures since 2009 Foreclosure Foreclosure Foreclosure Foreclosure Source: Realty Trac and Census Bureau Share of Distressed Mortgages Higher an the Nation, But Declining Mortgages 90+ Days Delinquent (Percent of All AcCve Mortgages) 12 10 8 6 4 Area Completions Rate Completions Rate Atlanta MSA 11,100 0.5% 92,800 4.3% 2 Nation 196,500 0.2% 2,332,100 1.8% 0 Springs-Marietta, Georgia Note: Foreclosure Rates as Percent of All Housing Units; Data through September 2011 for Foreclosures since 2009 Source: Realty Trac and Census Bureau 8,000 Atlanta MSA NaCon Source: CoreLogic 7,000 The Administration’s Eﬀorts to Stabilize the Atlanta Housing Market: 6,000 Mortgage Aid Extended More an 135,000 Times to Mitigate Rising Foreclosures 5,000 Atlanta MSA: Cumula3ve Oﬀers of Aid by Source Compared with Foreclosures Since April 1, 2009 (Thousands) 4,000 3,000 2,000 2010 right axis) Sales NaCon U.S. Department of Housing and Urban Housing Market and Policy Development and Research The Obama Administration’s Eﬀorts to Stabilize TheDevelopment | Office of Help American Homeowners | November 2011 From the launch of the Administration’s assistance programs 1,000 in April 2009 through the end of September 2011, 0 approximately 135,800 mortgage assistance interventions have been offered to homeowners in the Atlanta metropolitan area. More than 114,300 interventions were offered through the Home Affordable Modiﬁcation Program (HAMP) and the Federal Housing Administration (FHA) loss mitigation and early delinquency intervention programs. An estimated additional 21,500 proprietary modiﬁcations have been offered through HOPE Now Alliance servicers. While some homeowners may have received help from more than one program, the number of times assistance has been offered is nearly one and one-half times the number of foreclosures completed during this period (92,800) in the Atlanta MSA. In addition to offers of mortgage aid to homeowners, the Administration’s Neighborhood Stabilization Program (NSP) DeKalb County has not only brought new life to once vacant proper3es, but has and Hardest Hit Fund have helped to stabilize the Atlanta rket sales crea3ng a “spillover” eﬀect that is helping to stabilize communi3es, protect housing market. Piece by Piece, rivate investment to her erosion of household wealth, s3mulate lending, and acract pa local initiative organized a comprehensive strategy to partner with others and build a stronger, more sustainable Atlanta MSA NSP Activity blighted 1 Units) Projected e used to rehabilitate Cedar Pines Apartments, a (Housing68 unit apartment complex. Completed bstandard apartment complex and turned it into a highly desirable residen3al community. NSP1 Total 957 511 located near local transporta3on and other ameni3es. More than half of the units are comes at or below 50 percent of AMI. 16 16 sed NSP funds to purchase 15 unﬁnished homes in Avington Glenn, a subdivision 41 Construction of new housing s before comple3on. The comple3on of the homes revitalized the neighborhood and prices in the area. NHomeownership assistance to eligible homebuyers. 167 ine of the homes have been sold to low- and Clearance and demolition 99 moderate-income Rehabilitation/reconstruction of 733 olders from across the Atlanta area organized an innova3ve local foreclosure response residential structures (PBP) ini3a3ve which harnesses the collec3ve forces of more than 140 public and working to prevent foreclosures from occurring and to reoccupy vacant and abandoned NSP3 Total 1220 na3onal organiza3ons make up the PBP leadership team, which include the Atlanta Clearance Regional Commission (ARC), CredAbility, Enterprise 12 t Partnership (ANDP), the Atlanta and demolition ederal Reserve Bank oHomeownership assistance to low- and ssocia3on, the Home f Atlanta, the Greater Atlanta Home Builders A 992 onal Housing Conference, and NeighborWorks America. The HUD Atlanta ﬁeld oﬃce has moderate-income e leadership team from the earliest stages of the ini3a3ve. Coordina3on and staﬀ by ANDP. Examples Rehabilitation/reconstruction of of PBP ac3vi3es include: residential structures 216 ARC, the top leadership from ﬁve Atlanta area coun3es -‐-‐ Clayton, DeKalb, Fulton, par3cipated in a roundtable discussion of county-‐based solu3ons and best prac3ces in me of which are funded through the Administra3on’s NSP program. Local NSP managers from across the region meet monthly at ARC and via web-‐conferencing to collaborate on mi3ga3on challenges and opportuni3es. 0 396 0 0 0 0 Mortgage Aid Oﬀers in Atlanta MSA from April 2009 through September 2011: 135,800 Foreclosure Comple3ons Over Same Period: 92,800 160 140 120 100 80 60 40 20 0 FHA Loss Mi3ga3on Hamp Modiﬁca3ons Es3mated Hope Now Modiﬁca3ons Foreclosure Comple3ons Note: Data on HOPE Now proprietary mortgage modiﬁca3ons are not available at metropolitan area level. However, HOPE Now Alliance reports 102,300 non-‐HAMP modiﬁca3ons since April 1, 2009 in the state of GA of which 21 percent are es3mated by HUD to have occurred in the Atlanta MSA. Sources: Departments of HUD and Treasury, HOPE Now Alliance, and Realty Trac. by members from both the public and private sectors with the assistance of the local and regional HUD ofﬁces, has also helped residents avoid foreclosure. Given over three rounds, the Neighborhood Stabilization Program has invested $7 billion nationwide to help localities work with non-proﬁts and community development corporations to turn tens of thousands of abandoned and foreclosed homes that lower property values into homeownership opportunities and the affordable rental housing that communities need. In addition to stabilizing neighborhoods and providing affordable housing, NSP funds have helped save jobs. Each home purchased, rehabbed and sold through the NSP program is the result of the efforts of 35 to 50 local employees. Overall, a total of $91.2 million has been awarded to seven grantees in the Atlanta MSA: the City of Atlanta and the counties of Cobb, Clayton, DeKalb, Fulton, Gwinnett, and Paulding. The jurisdictions received $68.3 million in NSP1 funds and $22.9 million in NSP3 funds. The State of Georgia has also received $97.0 million in NSP funds to be used across the state for neighborhood stabilization. Approximately 511 households have already beneﬁted from NSP, and activities funded by the program are expected to provide assistance to an additional 2,177 owner and renter households. Here are some examples of how these funds have been put to use: Spotlight on Atlanta MSA | Page 3 U.S Department of Housing and Urban Development U.S. Department of the Treasury U.S. Department of Housing and Urban Housing Market and Policy Development and Research The Obama Administration’s Eﬀorts to Stabilize TheDevelopment | Office of Help American Homeowners | November 2011 • NSP funds in the Atlanta MSA provided the opportunity for more than 180 female heads of household to purchase homes with an affordable mortgage if their income was at or below 50 percent of area median income (AMI). • The City of Atlanta secured a $600,000 grant from the Green Home Advantage Program via Enterprise Community Partners and The Home Depot Foundation to improve air quality and reduce water and energy consumption in NSP homes. Buyers of green designated homes can save more than a third on utility expenses. Another innovative NSP program used green rehab practices developed by South Face and Enterprise Community Partners to lower utility costs. Money netted from home sales are being recirculated back into the construction of other NSP eligible activities. • The City of Atlanta, in partnership with developers and other ﬁrms, leveraged $2.8 million to acquire and rehabilitate or demolish 265 units. Twenty-two blighted units were removed and 48 units have been rehabilitated so far. Twenty of the properties have been sold to homeowners and 22 have been rented to income eligible households. In some cases, NSP ﬁnancing was provided towards the purchase of these foreclosed properties. • The sale of NSP homes in DeKalb County has not only brought new life to once vacant properties, but has introduced higher-value market sales creating a “spillover” effect that is helping to stabilize communities, protect existing residents from further erosion of household wealth, stimulate lending, and attract private investment to these neighborhoods. • • In Cobb County, as part of a comprehensive strategy to partner with others and build a stronger, more sustainable community, NSP funds were used to rehabilitate Cedar Pines Apartments, a blighted 168 unit apartment complex. The project revitalized a substandard apartment complex and turned it into a highly desirable residential community. The complex is strategically located near local transportation and other amenities. More than half of the units are available for people with incomes at or below 50 percent of AMI. The County of Gwinnet used NSP funds to purchase 15 unﬁnished homes in Avington Glenn, a subdivision abandoned by its developers before completion. The completion of the homes revitalized the neighborhood and slowed the decline of home prices in the area. Nine of the homes have already been sold to eligible homebuyers. In late 2010, more than 400 public and private sector housing stakeholders representing 140 agencies from across the Atlanta area organized an innovative local foreclosure response program, the Piece by Piece (PBP) initiative, which harnesses their collective forces to prevent foreclosures and to help reoccupy vacant and abandoned homes. The PBP leadership team includes local, regional, and national organizations such as the Atlanta Neighborhood Development Partnership, the Atlanta Regional Commission, CredAbility, Enterprise Community Partners, the Federal Reserve Bank of Atlanta, the Greater Atlanta Home Builders Association, the Home Depot Foundation, the National Housing Conference, and NeighborWorks America. The HUD Atlanta Regional Ofﬁce has worked very closely with the leadership team from the earliest stages of the initiative to develop benchmarks of accountability. The Piece by Piece initiative has yielded major success in the local housing market: • Elevating local solutions to help heal the Atlanta metro market. Under the coordination of the Atlanta Regional Commission, the top leadership from ﬁve Atlanta area counties -- Clayton, DeKalb, Fulton, Gwinnett, and Rockdale -participated in a roundtable discussion of county-based solutions and best practices in addressing foreclosure, some of which are funded through the Administration’s NSP program. Local NSP managers and other government staff from across the region meet monthly at the Atlanta Regional Commission and via webconferencing to collaborate on a wide range of foreclosure mitigation challenges and opportunities. • Putting vacant homes back into positive use. Under the leadership of the Westside Home Builders Association, Douglas County has implemented a local initiative to rehabilitate and sell foreclosed homes in the county. The Douglas County Initiative engages local home builders for the rehabilitation work, local real estate professionals for the sale transactions, and local lenders for mortgage lending products which are critical to the survivability of the local homebuilding industry. In addition, PBP partners jointly sponsored an information session for more than 150 housing professionals on mortgage lending products such as HUD’s Section 203(k) which can help homebuyers or investors ﬁnance the purchase and rehabilitation of foreclosed homes. As part of the State of Georgia’s housing recovery efforts, the HomeSafe Georgia program was launched on April 1, 2011 to help approximately 18,000 Georgia homeowners who have experienced a substantial decrease in income due to job loss or underemployment, by providing a mortgage payment bridge while they seek new or better employment. HomeSafe Georgia is funded by a $339 million grant from the Administration’s Hardest Hit Fund and administered by the Georgia Department of Community Affairs (DCA) under contract with the Georgia Housing and Finance Authority’s GHFA Affordable Housing, Inc. Assistance is provided in one of two ways: Mortgage Payment Assistance: Under this program, the homeowner’s monthly mortgage payment is paid directly to the lender for up to 18 months. The homeowner’s household income is reviewed to determine the level of assistance needed and the minimum mortgage payment that may be contributed by the borrower. Eligible homeowners close on a 0 percent interest rate subordinate loan similar to a home equity line of credit. Following the assistance period, the loan will be forgiven at a rate of 20% per year for ﬁve years. Reinstatement Assistance: Under the Reinstatement Assistance program, a one-time payment is made to the lender to cover up to 6 months of missed mortgage payments and lender fees. To date, more than 80 mortgage servicers have agreed to participate in at least one of the Home Safe programs. Georgia homeowners who believe they may be eligible for these programs should visit www.homesafegeorgia.com. Georgia has these funds available until 2017 or until all funds are expended to help struggling homeowners and prevent avoidable foreclosures. Spotlight on Atlanta MSA | Page 4