Yesterday’s real estate section of The New York Times published “Reaping a Profit, With the City’s Help.” Homeowners that purchased their homes through a city-run agency called HomeWorks are reaping the rewards of investing in Harlem at a time when it wasn’t considered “fashionable.” Now, those same houses that cost the owners around $250K are selling for $1.2 million with recent listings asking as much as $3.2 million. One owner even flipped her townhouse into a guesthouse bringing in $125 per night.
Although these are wonderful results for the original homeowners, we are left wondering how is this investment benefiting the neighborhood as a whole? Should people be profiteering when a neighborhood like Harlem is still basically in crisis mode?
After living in a HomeWorks house on West 132nd Street for only two years, the owner resold it last year for $1.34 million, according to city records. Under terms of the original purchase agreement, the penalty for selling before six years would have been $30,000, but the profit would have been more than $900,000.
Shouldn’t these programs have been designed to stabilize the community? Instead the turn over rate and profitting is now benefits those that can afford to spend millions of dollars on a home instead of the residents already in the neighborhood who want to be homeowners.
The HomeWorks program was created in 1995 as a way to encourage home ownership and to restore vacant buildings that had been taken over by the city after their owners abandoned them and failed to pay the taxes. At the time, there were the first stirrings of revival in the market for town houses in Harlem.
Read the whole article here: New York Times
k
September 5, 2006
I do agree that flipping so quickly not only destablizes the community, it also makes it extremely difficult for first time buyers to participate in this “renewal”
Jaye
September 5, 2006
I dont have a problem with their flippin properies or making a huge profit off of them. They came in and actually contributed to the stabilization of the market and now they can sell it and someone else will come in and hopefully continue that..I only wish that I had been one of them! Darn!!