Here’s what the WaPo said about it:
Fairfax County approved a landmark housing program yesterday to buy foreclosed properties for middle-income families, becoming one of the first communities in the country to tackle the nation's growing mortgage crisis while also addressing the region's increasing demand for affordable housingAccording to Gardner’s report, the county will buy outright about ten percent of the homes in foreclosure. For the rest, Fairfax will help first time homebuyers purchase houses through subsidized loans, taking advantage of the fact that thousands of homes have fallen below market value, in what the Washington Post has termed “a unique moment.” Here’s the Post quoting Connolly:
"Fairfax, like the rest of the country, is facing a foreclosure crisis that's unprecedented," said county Board of Supervisors Chairman Gerald E. Connolly (D), who proposed the idea. "The county has to use its resources and influence to try to stem the tide."For more details on the dollar amounts and the nuts and bolts of how this plan will work, read the entire article.
Meanwhile, some critics – and every good idea has critics, who often make valid points – charge that instead of putting money into selling these homes to others, the county ought to be doing more to aid the original owners to avoid foreclosure in the first place. As I said, those critics have a point. And Fairfax will, indeed, include financial counseling to homeowners in distress to help them avoid falling into foreclosure if possible.
For some, however, the aid will come too late. They’ve already lost their homes, which stand abandoned, creating a host of problems for the neighborhoods where they are located. I’ll get to those problems in a minute. But I have to add that for many, their financial problems are beyond rescue.
Too many victims took home loans with unrealistic adjustable rates that ballooned. They started with below market “teaser” rates designed to attract homebuyers who had no hope of being able to afford their homes. It’s why the entire industry needs better regulation. Adding to the problem, those who might be able to hang on by refinancing those homes to obtain a more affordable and realistic fixed rate mortgage are locked out of that solution because sinking housing prices mean their homes are no longer worth what they paid for them. Once the housing bubble burst, so did their dreams of owning their own home. You might call it the bursting of the American Dream for many.
Unfortunately, that also leaves an American nightmare for other property owners living in neighborhoods where foreclosed homes are abandoned. Here are some of the problems I told you earlier that I'd discuss.
Anybody who has lived in an urban or inner suburban area can tell you that abandoned buildings of any kind attract illegal squatters. Those could be gang members, drug dealers, addicts in search of crack houses or heroine shooting galleries. And those who take up illicit residence in these places drive up the crime rate as well as driving down the property values.
Ironically, Republicans on the Fairfax Board of Supervisors, such as Pat Herrity and Michael Frey, voted against this housing proposal because they believe the “market” will take care of the problem by attracting private buyers to the foreclosed properties. In fact, Herrity termed it “a problem in search of a solution.”
That’s only true if you believe the government has no role in protecting ordinary citizens and their investments (never mind that government can always find a way to help large investment banks and mortgage companies with expensive, tax funded bailouts). Meanwhile, we’ve seen how well the market has protected those hard working, middle class people by bursting a housing bubble, driving property values down, and leaving their neighborhoods vulnerable to squatters in abandoned buildings, and the accompanying rise in crime rates. Seems like that market could use a little assistance, both in better regulation at the federal level and some innovative programs like this one to help neighborhoods as well as new homebuyers at the local level.
Besides all that, real life is composed of more than just “market-based” values. There is something to be said for using public private partnerships to aid communities in other ways. And that’s another commendable feature of this program.
It would give fire fighters, police, nurses, teachers, and other county employees an opportunity to purchase homes in the communities in which they serve. Providing affordable housing to professionals in the community gives them an even greater stake in that community's well being. It makes those they serve their neighbors, friends, and family members. And in a real national emergency, who wouldn’t want their first responders living in their own communities, better able to truly respond quickly by getting to their duty stations rapidly?
There are manifold benefits to this proposal.
"It's a good idea," said John McClain, a senior fellow at George Mason University's Center for Regional Analysis. "It's been talked about nationally, and I hope that it will make a dent."Indeed, Connolly shares that hope.
Connolly said he hopes the program can be a model for the nation -- and also a beginning, capable of expanding if Congress approves legislation addressing the foreclosure crisis. Legislation before Congress would help more than 400,000 distressed borrowers trade mortgages with rapidly rising payments for more affordable government-backed loans if their banks forgive a portion of their debt.Once again, kudos to Gerry Connolly and the Board of Supervisors for providing a pragmatic and progressive solution at the local level to a growing national problem. This should put a spotlight on Fairfax County for innovative leadership.
"There could be an infusion of outside resources that would allow us to do more," Connolly said. "The federal bill is still winding its way through Congress. Fairfax would have a program in place to qualify, which is very much on our minds as well."