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Cranbury Conservative
Joined: Tue, Apr 29 2008, 9:26 am EDT
Posts: 287
Location: Old Cranbury Road
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 Posted: Thu, Oct 9 2008, 9:00 am EDT Post subject: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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I found this latest COAH topic to be particularly relevant due to the mortgage and credit crisis which is facing our State and Country currently.
If an Affordable Home which is purchased through COAH’s plan goes into foreclosure the home is then taken out of the town’s Affordable Housing pool. The once Affordable Home is then sold at Market rate by the bank which holds the deed for the property to the highest bidder for a profit. The town is then liable for building another affordable home to replace the one which was lost.
Currently Clinton New Jersey has two Affordable Homes in foreclosure which will most likely be sold by the banks which hold the deed as market rate homes at a profit for these lending institutions.
The reason behind the profit is because the homes were originally sold for approximately $55,000 as Affordable Homes in 1999 and are now valued at well over $100,000
As a result Clinton will be responsible for building 2 more Affordable Homes at a cost of approximately $200,000 each while the banks make a profit.
How is this fair to the already struggling suburban taxpayers in New Jersey?
More on my blog:
http://cranburyconservative.blogspot.com/2008/10/another-coah-secret-foreclosed-coah.html |
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James
Joined: Mon, Apr 21 2008, 4:10 pm EDT
Posts: 129
Location: South Main Street
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| Posted: Thu, Oct 9 2008, 10:53 am EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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Interesting. I also understand that a COAH home that is owned for 30 years can be sold at market rate. I wonder if that means that the town has to replace the home with another COAH unit.
269 units in 30 years all coming up as market rate would mean having to add more housing to replace the units. So the COAH obligation is over 500 homes at that point (original plus new build). |
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Guest
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| Posted: Thu, Oct 9 2008, 2:23 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| James wrote: | Interesting. I also understand that a COAH home that is owned for 30 years can be sold at market rate. I wonder if that means that the town has to replace the home with another COAH unit.
269 units in 30 years all coming up as market rate would mean having to add more housing to replace the units. So the COAH obligation is over 500 homes at that point (original plus new build). |
Well, it is 269 homes now until Viridian starts building (probably an additonal 225 COAH homes). This will bring the ratio close to 2:1. Any other buildings that can probably send us into a 1:1 ratio. Cranbury township will be the largest landlord entity in town.
As Doria said - If you do not build it will not kick off COAH home obligations. Who knows what the laws will be in 30 years. So, we must look to the implications for the next 10 years.
I'd rather have those COAH homes be converted to market rate in 30 years to readjust the residential ratio. Having such a huge COAH obligation that is rental only will change Cranbury into a rental community that can last for decades. This is devastating for property values. A good mix of rentals and home ownerships is beneficial to the survival of our town. |
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Guest
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| Posted: Thu, Oct 9 2008, 3:35 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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Unless in 30 years those homes become market rate and have to be replaced by COAH homes. Then you have the same problem as today, but with an additional 269 plus homes having to be recreated to replace those who were COAH. I'd rather not keep increasing the housing stock even if it resets a ratio.
In either scenario, COAH has to change today. |
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Guest
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| Posted: Thu, Oct 9 2008, 3:51 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| "Banks making money off COAH foreclosures" is an interesting issue to get upset about. COAH housing recipients are allowed to refinance upon request, which means that a house bought in 1999 could have been refinanced right up to (or beyond) market value. Until you know what's due on those homes you might want to hold your temper, since it's extremely rare for a home with significant equity to be foreclosed upon. |
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Cranbury Conservative
Joined: Tue, Apr 29 2008, 9:26 am EDT
Posts: 287
Location: Old Cranbury Road
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| Posted: Thu, Oct 9 2008, 3:54 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| The key point is the town is now liable once again for more affordable housing. |
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Guest
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| Posted: Thu, Oct 9 2008, 4:03 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| Can the town buy the housing back? Foreclosures don't go for above market value. Just something to consider. |
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Cranbury Conservative
Joined: Tue, Apr 29 2008, 9:26 am EDT
Posts: 287
Location: Old Cranbury Road
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| Posted: Thu, Oct 9 2008, 4:08 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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Thats a burden to the taxpayers then. The point is the Affordable Homes were built. Now they are out of the pool and the town is liable for more housing.
How is that fair to the taxpayers? |
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Guest
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| Posted: Thu, Oct 9 2008, 5:00 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| Cranbury Conservative wrote: | Thats a burden to the taxpayers then. The point is the Affordable Homes were built. Now they are out of the pool and the town is liable for more housing.
How is that fair to the taxpayers? |
I don't think this is something that we need to worry about, but just be aware that it can happen. I think the town should take a closer look at preforclosure home and if it's a COAH home, help find a low-moderate income person on the waiting list to purchase the home. We are a small town and I'm sure if they ask one of the many realtors living in our town to keep a close eye on any of the COAH homes popup on their lists that will be going into forclosure just give the township a heads up. It helps the bank out since they are dealing with so many foreclosures all over NJ and prevents that COAH home going back into the mix. |
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Guest
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| Posted: Thu, Oct 9 2008, 5:14 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| Cranbury Conservative wrote: | | The key point is the town is now liable once again for more affordable housing. |
I don't think this should stop up from building rentals and home ownership mix. Since the 269 COAH will represent a 3:1 ratio (quickly approach 1:1 ratio with Viridian and other commercial building) - I don't think a home builder will win in the courts if they try to do a "builders remedy". The residental ratio overexceeds every other town. So, zoning is extremely important.
A home builder can come in and make them all market rate homes to up our residential ratio. They make more money and we have a larger COAH obligation. So, I don't think we have to worry about "builders remedy". |
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Guest
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| Posted: Thu, Oct 9 2008, 5:52 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| Independant News wrote: | "What these statements have ignored is the fact that COAH is allowing municipalities to build affordable housing based only on the actual growth that occurs in their communities.
"Essentially, you must only build affordable housing when you build marketrate housing and commercial development," he added.
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SO, if that COAH home goes into forclosure and the bank can go and sell it at the market rate. If that COAH home was built before this round 3, it would not be added into the COAH obligation since it is not newly built. So, if no more homes or businesses are built in our town, we will not have to build anymore COAH homes.
So, correct me if I'm wrong - just trying to figure this out. With proper zoning, preservation, and stop residential and commercial building, We will currently have:
1 - Have to build 269 low - moderate homes (3:1 residential ratio)
2 - Increase COAH obligation from Viridian
(possible 2:1 ratio - 225 homes)
3 - COAH designation expires 20 years on rentals and 30 years on home ownership.
4 - We will not have to build anymore COAH homes after 2018 if not building.
So, if after 30 years the COAH home owners revert to market rate homes - ratio will positively change. COAH designation does not need to be replaced especially since it is about growth share and building. If no building has been going on, no COAH obligation.
IMHO since the laws change so frequently do you really buy what Doria is saying? Great in theory, but is not reality. Making property owners pay up front for a 30 year subsidized obligation. Not only that, Do you really think no building will happen in 30 years? |
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Cranbury Conservative
Joined: Tue, Apr 29 2008, 9:26 am EDT
Posts: 287
Location: Old Cranbury Road
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| Posted: Thu, Oct 9 2008, 6:45 pm EDT Post subject: Re: Another COAH Secret: Foreclosed COAH Homes are sold to the highest bidder |
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| And that is the point for bringing up this conversation. There are many problems with COAH and the foreclosure loophole is just one more example of what is wrong. It is important for us to keep highlighting these issue in our effort to fight what the leadership in Trenton is trying to do to the suburban taxpayers. |
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