The housing market's collapse is prompting Sparks to join a federal program that aims to put a dent in the foreclosure crisis and place residents in affordable homes at the same time.
Sparks City Council recently signed off on taking part in the Dollar Homes Program through an effort with the Reno Housing Authority, an action that allows the housing authority to buy for $1 some U.S. Department of Housing and Urban Development-owned homes that have been on the market for more than six months without offers.
"The goal is to get these houses filled, get somebody in them, get the lawns watered, take care of them, try and improve the neighborhoods," housing authority official David Morton said last week in a briefing with the council.
The effort is part of a federal program to help low-to-moderate-income families with housing. Organizers plan to rent foreclosed homes initially and leverage the value to buy other properties. They hope to take several homes off the foreclosure market.
"I have 165 tenants in single-family homes in Reno and Sparks today," Morton said. "The market is so bad that we have landlords coming to us right and left (saying), 'Do you have tenants who you can put in my units and pay the rent on my mortgage?'"
"It's endemic," he added. "We've never had this many single-family homes that we are renting."
In some cases, people had bought homes hoping to "flip" them to turn a profit, but failed to resell the homes. In other cases, they could not afford the mortgage and have moved into something cheaper.
"We had a couple who owned a home who are moving into a one-bedroom unit and trying to rent their house to pay the mortgage so they don't lose it," Morton said.
The program dates back to 2000, but Morton said it has never been applied in the Reno-Sparks area.
"In the past, it would have only been useful in a slum city or in some places where nobody wanted to live," he said. "The market right now is that there are some nice houses coming up through the HUD foreclosure program."
Morton assured council members that high standards will be in place for tenants. He wants the renters to act as if they own the homes -- so "that (other) people think they own it."
"We will be doing double inspections over what we would normally do, to try and make sure that we keep those (homes) in just an exceptional manner," Morton said.
Sparks grants administrator Tracy Wheeler assured the council the city would have "no costs and essentially no liability."
Officials had only a 10-day window to act as part of efforts to expand "affordable and fair housing into the community," Wheeler said. "It's real quick that you have to turn this around."
Councilman Ron Smith is praising the program but is not happy with circumstances leading to the foreclosures.
"I just wish the banks would be working with people who are being foreclosed on," Smith said. "It's crazy. They want them to be delinquent, not pay their bills, not pay their house payment before they will even talk to them, and then we turn around and buy a house for a dollar. It's insane."
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