COVINGTON -- Eight town homes in Walker's Bend subdivision off Ga. Highway 81 have been purchased as part of the city of Covington's Neighborhood Stabilization Program.
The city's NSP partner, Habitat for Humanity, has already identified eight families that qualify to purchase the homes and is working on getting them moved in before Christmas, according to Planning Director Randy Vinson.
The city received $428,070 in federal stimulus dollars to purchase, rehabilitate and resell foreclosed properties through the NSP.
Initially, officials estimated they could buy four to five homes with the money, at a cost of $60,000 to $80,000 per home and a repairs budget of between $18,000 and $25,000 per home.
But because the town homes are new and have never been occupied, needed repairs, some due to vandalism, will be very minor, Vinson said, which allowed for the purchase of more properties. Also, the purchase price was lower than expected, at about $50,000 per home.
Five percent of NSP funds are being set aside for administrative costs.
Once the houses are purchased, the remainder of the money will be reinvested in additional properties. Habitat will receive payments from the new owners and will write a lump sum check to the city every month. Additional properties purchased may or may not be in Walker's Bend, Vinson said.
"I'm not aware that there are that many new, vacant homes that are foreclosed on or are about to be foreclosed on in Covington," Vinson said. "In the future, we may have to focus on older properties that need repairs."
The neighborhood was not the city's first choice to benefit from NSP funds.
Initially, the city targeted Jefferson Village, but had issues making contact with the owners of foreclosed properties there. Sterling Lakes off Flat Shoals Road then became the primary focus, but the foreclosed properties there were owned by HUD and by the time the city got approval, they had been snapped up by investors.
After asking the Georgia Department of Community Affairs to open up the entire qualifying census tract, officials discovered the available homes in Walker's Bend, located on Ga. Highway 81 between Covington and Porterdale.
"It's just the luck of the draw that the eight town homes became available right when we needed them," Vinson said.
The primary developer and builder in the subdivision have gone bankrupt. There are 80 completed houses there, 31 of which are owner-occupied and 36 that are owned by investors as rental units. The city is hoping to tip that balance in favor of owner-occupied homes through the purchase of the eight town homes, Vinson said. In addition, there are about 140 vacant lots in the neighborhood, owned by as many as eight different banks. The Federal Deposit Insurance Corporation owns about 30 of those vacant lots.
"It's still a moving target in there as to whether anything really substantial can happen," because there are so many entities involved, Vinson said.
Covington is the first community in Georgia to complete the NSP, Vinson said, adding that the city may be eligible for additional funds this winter, since communities who opted out or haven't been able to execute their plans are required to forfeit their funds. DCA will reallocate those monies based on successful completion of the first round of the program, he said.