How Baltimore Ensures NSP is NOT Destabilizing Their Market

The Neighborhood Stabilization Program requires that a foreclosure be purchased for 15 percent below market value. This requirement has caused concern among some that the discount requirement will result in a steeper decline in housing prices and further destabilization. In many cases, there is not a place to record the discount so appraisers, often rely on MLS data or data from local property taxation departments, may never know these transactions are discounted.

The folks at the Greater Baltimore Board of REALTORS® are actively addressing this issue by working with their Department of Assessment and Taxation to code transactions using NSP funds as “not arms length” on the assessment record. This helps ensure that appraisers have the most accurate information on homes when they perform valuations.

Appraisers, local governments, and REALTORS® should be working together in a similar fashion across the country to solve what many believe is the most troublesome aspect of the Neighborhood Stabilization Program.

Is something similar happening in your community? Do you have other best practices stories to share? Please share your comments with us.

  1. Joe Lenti

    Last year i purchase 2 homes @ a forclosure auction, 1 in Georgia @ 40% off & 1 in Orlando fl. @50% off the previus year selling price

  2. Tony

    I sent letters to our previous president Mr. Bush, Mr. Obama and to many key people of the white house administrations including members of both parties, I suggested a quick fix to United States Economy and specificly the housing market, How! In my plain opinion that was not based on sttistics or study, there was no such bubble on home prices before year 2000 and from 2003 to 2006 it heated up! the quick fix is: why not put all homes to the base of year 2000 and take the home value from there not what your neighbor sold lately! It was enough that the stock market lost value to 1997 and now the home value is standing at 1970 prices or below! It was not fair for the majority to lose their home value and equity just beause your neighbor was a bad investor and the lender through repossession sold your home for $25,000 while you purchased it for $200,000
    Appraisal report will not work in this kind of market unless we can out it back to the base where ther was no bubble which is year 2000!
    Mr. Obama suggested in his latest plans to save the home value it will take much more years to stabalize the home value, I understand 31% DTI ratio is good idea to keep borrowers from borrowing more than what they can aford, but that will not help resale of homes, if you tell Americans that their home value is standing where it was in year 2000 believe me they wil sell today and upgrade and buy new homes..etc., but when you tell the American people that your home is 1970 prices I’m going to die in it or give it away to the homeless!
    What about the people who purchased between 2000 and 2006 during the bubble, what is the value of their homes! good question?
    inflation was based on 3% assuming that in year 2000 the price of similar home was $100,000
    in 2001 it worth $103,000
    in 2002 $106,090
    in 2003 $109,272
    in 2004 $112,550
    in 2005 $115,927
    in 2006 $119,405
    in 2007 $122,987
    in 2008 $126,677
    in 2009 $130,477
    This will be the base for everyone!
    I maybe not much of an educated about economy and troubled housing market and world’s economy but we need a base to start from to maintain home equity for people who want to send their kids to college or buy a car or take a vacation or buy an appliance, if you take my equity and my 401 and my credit card and my job Mr. Obama may need another 5 trillion dollars in 2010 and we still in the hole!
    I’m not asking the impossible, but it’s fair to say year 2000 was the base before Mr. Green span made a decision to boost the eonomy while at war in 2001 and lower the interest rate to almost 1%
    What to do with the people who were cheated by the adjustable rates! Simply go after the cheaters and sue them and put them out of business. What about the investors bought more than one unit, it’s their problem like the stock market investors they gamble and they lost, we the home owners didn’t gamble we have been taught to pay for our homes to keep not 30 years to take it from us for almost nothing!
    A quick fix to our economy is needed and hope our prsident will read this message! I’m only the ordinary citizen who care for the people of this Country!
    One last remark the Appraisal report guide lines are outdated in this kind of crisis; appraisers shouldn’t allow to look at a price of dumps sold in your neighborhood and make it as a comp to your property. Many homes sold are destoyed that appraisers consider it the base of your home value, I don’t blame them for the old school equation, but the law has to be changed so they can work more as professional in this type of crisis. The USPAP needs to modify the rules of appraising ASAP or we will be in the hole for many years to come, and we don’t want this to happen.
    God bless you all…

  3. I agree with the basic idea. In most of Northern Virginia we can sustain prices at the 2003 level. Also 31% DTI would be great -but is not realistic in this high cost area. FHA and VA have been making successful, full documented loans at 40%+DTI for years.