Demetrice Fitzgerald’s family outgrew their three-bedroom brick home on Bromley Way, Unfortunately their home, appraised for around $176,000 three years ago, dipped in value to $135,000. Others on their street were having similar, if not worse, problems. Many neighborhood homes were in default, and that definately wasn’t going to help them sell theirs.

"The last thing we need on the street is a foreclosed-upon house," Fitzgerald said. Luckily in mid-January, her street became the first targeted by the city of Nashville as part of a federally funded program aimed at stabilizing and protecting neighborhoods from the growing problem of foreclosures.

Five houses down from Fitzgerald's home is a beige-and-brick property purchased by the Metropolitan Development and Housing Agency. They plan to buy, repair, and sell 35 homes in foreclosure as part of a $2 million Neighborhood Stabilization Program grant.

Eligible for the program are foreclosed-on homes in north, northeast and southeast Nashville, said Sima Thakkar, assistant director for community development at MDHA.

"We're trying to be strategic," Thakkar said. The idea is to buy groups of homes in foreclosure in otherwise good neighborhoods. This intervention is aimed at keeping the neighborhoods from falling into disrepair and becoming crime magnets.

How Have Other Cities Done?

This program, the first of its kind in Nashville, has worked successfully in other cities that have already started spending similar grants. Philadelphia began utilizing neighborhood stabilization money a year ago and has close to 40 homes in some stage of rehabilitation, said Terry Gillen, executive director of the Philadelphia Redevelopment Authority. $20 million was awarded to them for the program, which will eventually move 180 homes out of foreclosure and back into the market. It will also target local unemployment, with jobs for 200 construction workers, Gillen said.

"They (neighbors) worry when they see these empty houses," Gillen said, pointing to one neighborhood that took to mowing the grass and cleaning the sidewalk in front of an empty house that had fallen into disrepair. It affects ev eryone in the neighborhood when one house fails.

The redevelopment authority bought that home as part of the local program. "They were worried about what this one house would do to the rest of them," Gillen said.

Lets Talk Numbers

$30.5 million in federal stimulus funds will support the $2 million dollar program. In addition, there is a $900,000 grant to help buy a 44-unit apartment building that was in foreclosure in a high-visibility location on 12th Avenue South.

In Nashville, MDHA plans to spend $3,500 to $10,000 to repair each home. They will include incorporating energy-efficient tactics and products into the repair, Thakkar said.

Market value, as well as what prospective buyers can afford and the financing that's available, will set the sales price.

tter-spacing: 0.0px;">"We don't want to lower the sales price to where it hurts other neighbors, but we want it to be affordable," Thakkar said.

The home price cannot be more than the amount MDHA spent to purchase the property and invested into its repair, officials said. Prospective homeowners cannot earn more than 120 percent of the area median income to qualify. This means $53,100 a year for an individual and $68,250 for a family of three.

Those income levels are generally higher than the limits for other government housing programs, targeting this one more to middle-class families, Thakkar said.

"Maybe it's that schoolteacher who has a household of three or four," she said. "This helps her get a good buy, or helps people transition from rental units into their first home. It gives them opportunity."

Making Rentals Affordable

Another way the city is tackling the foreclosure crisis aims to put more affordable rentals on the market.

As mentioned before, a $900,000 neighborhood stabilization grant helped buy the Belmont Village apartments on 12th Avenue South. The complex had been in foreclosure before the Woodbine Community Organization bought it for $1.065 million with the grant money.

The apartment was struggling to keep half occupancy. It was in desperate need of a new roof, landscaping and a near-total overhaul of the interior.

"It was just going to sit there," said Cathie Dodd, executive director of
the Woodbine Community Organization. By intervening, Woodbine was able to stop a blight along a heavily traveled corridor.

Because the purchase was subsidized by the grant, Woodbine will be able to keep intact the $500 monthly rent for the one-bedroom, 400-square-foot apartments, despite improvements that include new carpet and paint, modern cabinetry, new appliances and new HVAC in some units, said Tony Woodham, deputy executive director at the agency.

When tenant Jerry Robertson, 60, heard the building was in foreclosure, he assumed he'd have to move. He was relieved to learn he could stay.

"It's hard to find," Robertson said of affordable rental housing convenient to the bus line and the city center.

Another tenant, Barbara A. Robertson, 57, was pleasantly surprised that her rent wouldn't increase, despite all the upgrades. "If it had gone up $50 or $100 more," she said, "that wouldn't be affordable to me anymore."