A New Jersey Senate committee will consider legislation Thursday that would encourage towns to turn foreclosed homes into affordable housing.
The measure would create the New Jersey Foreclosure Relief Corporation. It would be charged with buying vacant foreclosed homes, then putting deed restrictions on them for use as affordable housing.
Sen. Ray Lesniak, D-Union, says the measure creates incentives for towns to purchase the properties to meet their affordable housing obligations under the Mount Laurel ruling.
“Municipalities, which participate in this program through use of their affordable housing trust fund will get a two-for-one credit against whatever their Mount Laurel affordable housing requirement may be,” Lesniak said. They also will be given a extension of two years from the statutory obligation to use these funds or lose them to the state, he said.
Lesniak anticipates that the program has the potential to turn boarded-up homes into 10,000 affordable housing units.
If towns don’t buy the properties the state purchases, it would sell the homes at market rates.
He sees it as a way of addressing a nagging problem that continues to escalate.
“It’s so much more than housing and boarded up homes,” Lesniak said. “It’s a drag on our economy. It’s a drag on property values in neighborhoods. It’s a drag on people’s wealth, which is a then a drag on their consumer confidence, which is a drag on our economy.”