How to Apply for Loudoun Neighborhood Stabilization Program, List of Designated Areas

Loudoun County just released the name of the neighborhoods that qualify for the Neighborhood Stabilization Program (NSP). This is part of the NSP application process to, which Loudoun will submit to Virginia at the end of this month in hopes of securing at least $2 million to buy foreclosed properties for rehab.

The designated neighborhoods are (Adobe Reader required):

• Crestwood Hamlet
• Heritage Square 
• Hunington Ridge
• Sterling Park South (A)
• Sterling Park South (B)
• Sugarland Run

The application for the Neighborhood Stabilization Program requires Loudoun County to provide a list of qualified buyers that would be interested in purchasing a property in these designated neighborhoods.

If you are interested in purchasing a property in one of these designated neighborhoods through the Neighborhood Stabilization Program, contact me and have the following information ready:

1. Name
2. Address
3. Phone number
4. Pre-qualification letter from a lender (aka "approval letter" or "lender letter")

Important…

• The deadline for these applications is January 27, 2009 (the application from the county is due to Virginia at the end of the month and these applications need to be a part of that)
• Without the above information, the County will not process your application
• The information listed above is required by Loudoun County as well as Virginia - this is not a gimmick to get your information for my own records (I was asked by Loudoun County to be part of the group providing input into the program and application process)

My contact info: danilo.bogdanovic (at) gmail (dot) com – 703.582.6900 (cell)

Loudoun County Neighborhood Stabilization Program Update

Loudoun County held a meeting last Friday to discuss the Neighborhood Stabilization Program. Loudoun invited a select handful of folks to answer questions and provide feedback on putting together an RFP in order to apply for the Neighborhood Stabilization Program funds and how to most effectively use those funds.

Those in attendance included local bank representatives, a Dulles Association of Realtors staff member, a couple of Realtors (including myself) and various Loudoun County government staff. The Neighborhood Stabilization Program will be a collaborative effort on the part of those in the county government and lending and real estate industry so it was important to hear from people representing each of those areas.

Here are some of the Loudoun County Neighborhood Stabilization Program highlights and updates…

• Loudoun is fighting an uphill battle – Fairfax and Prince William Counties already got approval for the Neighborhood Stabilization Program ($2.8M and $4.1M), but Loudoun didn't get a dime
• Because of not already being approved, Loudoun has to submit an RFP (due January 30, 2009)
• Loudoun is shooting for the minimum – $2 million per allocated neighborhood
• Loudoun has already determined the required 3 neighborhoods that meet the requirements of the program, but the county is not releasing which 3 neighborhoods they've selected (?)
• Loudoun has determined that the types of properties within those 3 neighborhoods that qualify under the program's rules are town homes (no condos, single family, etc)
• There are some issues with legal language of contracts that need to be addressed prior to the RFP being submitted (don't ask me for details – it's all lawyer lingo)
• Loudoun is shooting for the minimum – $2 million per allocated neighborhood
• After surveying properties throughout the county, Loudoun determined that the majority of properties need "minimal to moderate" rehab costs
• They're going to be using some, if not most of the money to buy, rehab and flip properties

Here are some of the issues I have/see…

• When Loudoun surveyed the properties, they never once went inside any of the properties. With the majority of the necessary rehab work being on the inside of foreclosure properties, Loudoun has no idea of what the true costs of doing rehab on these properties will really be 
• Because they have no real idea of what the true costs per property will be, they're whole plan and budgeting of the money will be off 
• Rather than flipping a total of maybe 12 to 15 properties ($2M divided by average cost of property + rehab), why not focus on helping out the community and residents in ways to reach more people (how about 50 people) and those such as teachers and firefighters who can't afford to live in the same county they work in…(more to come on that in a future post)
• Loudoun must have dropped the ball or pissed someone off in Richmond because Fairfax County and Prince William County had no problem getting money for the program, but Loudoun didn't get any an now has to apply for the bare minimum (I have four words for you conspiracy theorists – "opposition of Grantor's Tax")

• Rather than flipping a total of maybe 12 to 15 properties ($2M divided by average cost of property + rehab), why not focus on helping out the community and residents in ways to reach more people and those such as teachers and firefighters who can't afford to live in the same county they work in…(more to come on that in a future post)

Though no process nor government program is perfect and most have some flaws, I think that the Neighborhood Stabilization Program is a good thing overall.

But Loudoun must make sure that it spends the money wisely and in the best interests of the neighborhoods and people it's supposed to serve – not for the self interest of Loudoun County government or revenue. This is especially true when you consider that $2 million is a drop in the bucket for a county that has $62.7 billion (with a "b") in total real estate values and hundreds of foreclosures on the market at any given point in time.

Related Articles

"Loudoun appeals to Richmond for funds" – Washington Business Journal