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City eyes plan to take equity stake in homes

Original post made on Apr 1, 2009

In an effort to keep low-income residents in their homes, the city of Menlo Park is considering a plan to buy an equity stake in some of those properties.

Read the full story here Web Link posted Tuesday, March 31, 2009, 3:11 PM

Comments (13)

Posted by renter, a resident of Menlo Park: Suburban Park/Lorelei Manor/Flood Park Triangle
on Apr 1, 2009 at 6:58 am

The city should not be a bank; they should get out of irect involvement. They should follow Palo Alto's example, an have an entity like Palo Alto Housing Corporation own/operate housing programs.

Posted by Condo owner, a resident of Menlo Park: Downtown
on Apr 1, 2009 at 7:00 am

The city is also trying to buy a BMR condo unit that is in foreclosure.

Posted by Hank Lawrence, a resident of Menlo Park: Sharon Heights
on Apr 1, 2009 at 7:14 am

The city should not be in the redevelopment business. Perhaps they could make a deal with Dave Bohannon where he would buy homes and work with Habitat for Humanity to refurbish them and put them back on the market as BMR homes in return for the city council to act as normal human beings and approve some of his proposed developments without ridiculous conditions. So Heyward, can you get permission from Gail to do that?

Posted by truth, a resident of Menlo Park: Belle Haven
on Apr 1, 2009 at 12:26 pm

Don't be a child, Hank. The petty personal jabs just make you look like a creep.

Posted by At Home in Menlo, a resident of Menlo Park: Downtown
on Apr 1, 2009 at 12:53 pm

I think this is a wonderful, cutting-edge idea. I'm less concerned with who carries out the plan or fussing over details. Public entities are quite as capable as private ones, as recent events have shown us, and are also more accountable. Bravo to Menlo Park!

Posted by long term resident, a resident of Menlo Park: Downtown
on Apr 1, 2009 at 5:36 pm

The city can not afford to start bailing individuals out. The units are already low income and they should just let another low income person/family move in. This is a pandoras box that will require more city employees.

Posted by Bill, a resident of Menlo Park: Suburban Park/Lorelei Manor/Flood Park Triangle
on Apr 2, 2009 at 10:08 am

I agree that this will add additional city employees, maybe the city could hire some of the ex AIG people who were the ones who packaged up shares in below market (subprime) housing loans and sold them to others! This whole concept would be managed by the same people who have done such a good job of building up a huge unfunded pension liability and are running a city where the revenues don't match expenditures. The city should stay out of this and let the market take care of things. How is the city doing with the residential properties it already owns??

Posted by mp, a resident of Menlo Park: Downtown
on Apr 2, 2009 at 2:15 pm

This is a terrific program to help stabilize neighborhoods, will require no additional staff and will not use general city funds.

The "market" helped create the housing mess and it could be many years before things change.

Foreclosed homes destabilize neighborhoods, help create homelessness and potentially add to crime.

If your neighbors were about to be foreclosed on, wouldn't you want some action taken to help or would you rather have that home foreclosed on? How does that help your property values? Or are you assuming that only homes in Belle Haven get foreclosed on?

Posted by freddie, a resident of Menlo Park: Menlo Oaks
on Apr 3, 2009 at 9:44 am

The foreclosed homes in Belle Haven are not languishing, but are being purchased. Just have a look at home sale listings in the newspapers. It's a good opportunity to buy. The city doesn't need to get involved.

Posted by 25 Year MP Resident, a resident of Menlo Park: Linfield Oaks
on Apr 3, 2009 at 10:32 am

This would be a ridiculous misuse of taxpayer dollars. We did not elect the City Council to speculate in real estate investments with our money. We all feel for the residents of Belle Haven, and if the City can negotiate better loans on their behalf, we will all benefit. There is no good reason for the City Council to take the next step and buy interests in private homes.

Posted by MP Shopper, a resident of Menlo Park: Downtown
on Apr 3, 2009 at 12:25 pm

The 3 programs are being paid for from developers fees. Your tax dollars are not being misspent.

Posted by Sorry MP Shopper, a resident of Menlo Park: Felton Gables
on Apr 3, 2009 at 2:43 pm

"Developer fees" ARE in fact taxes, and in this case they are lost taxes to the residents that have to pay taxes to replace those funds that could not be recouped from the developer. It is situations like this, and the funny math that is played with the budget, that as a tax payer is VERY frustrating.

Posted by Sean Howell, Almanac staff writer
on Apr 3, 2009 at 3:10 pm

Sean Howell is a registered user.

The two plans to buy homes and sell them to people on the wait list for below-market rate housing would be financed through fees paid by developers; the city doesn't know yet how the plan to buy equity in homes would be financed. According to Doug Frederick, redevelopment funds are one possibility. These are funds set aside by the state for use within a specific area. In Menlo Park, that area encompasses the Belle Haven neighborhood, and some of the "industrial" area east of U.S. 101.

The fees from developers that would be applied to these projects are earmarked specifically for below-market rate housing.

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