Mixed success for Chicago Heights housing programs
BY CASEY TONER firstname.lastname@example.org January 22, 2013 9:44PM
Maurice Cornelious in front of his home he recently purchased with help from a special Illinois housing program in Chicago Heights, Illinois, Wednesday, December 26, 2012. | Joseph P. Meier~Sun Times Media
Updated: February 24, 2013 6:02AM
Like many homeowners hit hard by the housing crisis, Maurice Cornelious owed more than his house was worth and wanted to move.
His two-bedroom, one-bathroom house in Sauk Village was “apartment-sized,” and he was looking for something bigger for his wife Nicole and their two young children.
Taking advantage of the state’s Building Blocks program, Cornelious found the home he was looking for in the 100 block of Terrace Drive in Chicago Heights. He received a $10,000 grant toward a down payment and closed on the purchase in October.
“It’s kind of a like a fresh start, and that’s the main thing about it,” Cornelius said.
But not every housing initiative by the city has met with such success. On the impoverished east side of town, out of 15 homes in a $3.6 million federally funded project, only two have been sold. Nine sit vacant, and four have yet to be completed.
Mayor Dave Gonzalez concedes the results there haven’t met expectations. But he isn’t giving up on his hopes for a market recovery.
“Everyone has seen their property values go down, including myself,” Gonzalez said. “Your property values are not going to come back overnight after the collapse. ... We just have to manage it.”
‘It won’t be overnight’
State officials said 31 people have taken advantage of the Building Blocks program that helped the Cornelious family. The program is offered only in Berwyn, Maywood, Park Forest, Chicago Heights and South Holland.
A total of $310,000 in assistance has been doled out, and the lion’s share of funds — about $9.1 million — remains.
It’s one of many government programs aimed at fixing the faltering housing market in Chicago Heights. Median home sale prices in the city of about 30,000 have fallen nearly 40 percent from 2008 through September 2012 — from nearly $150,000 to $95,000, according to realty website Zillow.com.
Efforts to jump-start the city’s housing market include rehabbing more than 50 foreclosed homes and getting them back on the market, helping homeowners with their down payments and building the 15 homes on the blighted east side.
“I believe right now you are looking at a housing collapse that started in 2008 that has affected not just Chicago Heights but the whole country,” Gonzalez said. “When you have economists saying that housing won’t rebound for another 10 years, it won’t be overnight. As long as we keep attacking it in areas, we’ll see it going in the right direction.”
Chicago Heights unveiled its first major housing project — heralded by late Mayor Alex Lopez — in 2009. Drawing from city funds, the city offered homeowners up to $10,000 on their mortgage down payments. A total of 57 people took advantage of it, using about $344,000 of the $500,000 the city budgeted.
Several city employees, including firefighters Matthew Cervak, Andrew Rothermel and Matthew Wachtor; water department employee Keith Perry; street department employee Ernest Willett; and police officer Thomas Somer Jr., son of city attorney TJ Somer, took advantage before the program ended in October 2010.
East side story: Owners wanted
In 2010, Homewood-based Mecca Cos. was hired to build low-cost homes on the east side. The project was part of the Neighborhood Stabilization Program created through the federal Housing and Economic Recovery Act of 2008.
The houses, most of which are owned by the city, are located on Wallace Avenue, Center Avenue and 16th Street.
Mecca Cos. chief operating officer Tom Tomaszewski said his company had wrapped up construction of the first nine houses in the spring of 2012 when it learned additional federal money was available to build six more homes. Overall, it’s a $3.6 million project, and four of the homes have yet to be completed.
Of the 11 homes built and for sale, only two have been sold, for $85,000 and $86,000. The rest sit vacant.
Buyers for the homes must have a total household income of no more than $87,000 for a family of four. Grant money is available to provide subsidies to buyers of up to 20 percent of the purchase price of the homes.
City attorney TJ Somer said that if the houses aren’t sold within two years, the city may work with banks to set up rent-to-own leases to get people moved into them.
“They haven’t sold as quickly as we would want,” Gonzalez said. “I don’t think the city will be the landlord here.”
More renovation projects
Mecca Cos. also was hired with funds from the Building Blocks program to renovate up to 30 foreclosed homes in the city. Budgeting as much as $125,000 per home, Tomaszewski said his company is buying the homes, repairing them and putting them back on the market.
Tomaszewski said the homes being repaired all are north of Lincoln Highway in the city’s more affluent neighborhoods. He said his company is responsible for the homes whether or not they are sold.
“Since we’re in the nicer wards, we will have a shorter period to sell them,” Tomaszewski said. “There’s definitely a risk, and it’s in the back of your head.”
Gonzalez said Chicago-based Hispanic Housing Development Corp. was hired with more federal money to renovate about 30 other foreclosed properties throughout the city and put them on the market.
Gonzalez said most of the rehabbed houses will be in areas where it’s “one vacant home sitting on a block” because it will raise the net worth of many houses on the block.
“We’re getting scattered homes throughout Chicago Heights that can increase the property value of the whole city faster,” Gonzalez said. “We have problems in our distressed communities where it’s (vacant) house after house after house.”