Shaun Donovan, secretary of the Department of Housing and Urban Development, visited Richmond today as part of an effort to highlight Project Rebuild [...] Donovan also toured the 800 block of North 27th Street in Church Hill with Richmond Mayor Dwight C. Jones to see how a similar program helped revitalize that neighborhood.
The Wall Street Journal has a better explanation of “Project Rebuild”:
It would create a $15 billion fund to get construction workers to rehab vacant and foreclosed homes and businesses. Construction hiring has been weak, of course, because competition from foreclosures has held new home building at abysmally low levels.
Dubbed “Project Rebuild,” the White House initiative follows on the work of the administration’s Neighborhood Stabilization Plan, which gave grants to nonprofits in communities hard hit by foreclosures.
The goal of the program is twofold: Beyond creating jobs, it tries to chip away at problems in the housing market by “attacking the overhang of properties,” said Housing Secretary Shaun Donovan in an interview.
The concern is that foreclosed properties tend to be less well-kept than traditional homes, and the properties sell at a discount out of foreclosure.
“If you live next door to a house that is foreclosed or vacant, research shows that your house—even if you’re current and making your monthly payment—your houses loses $10,000 on average,” said Mr. Donovan. “This is an opportunity to stabilize everyone’s property values in those neighborhoods.”