With more funding in tow, a housing organization in Springfield is celebrating an initiative that takes properties destined for auction and turns them into opportunities for first-time homebuyers.
Way Finders President and CEO Keith Fairey says another $2 million in grant funding from the MassMutual Foundation will support the affordable housing organization as its “City of Homes” initiative gets into full-swing.
Fairey announced the funding and more this month while standing before a two-family home in the Liberty Heights neighborhood. The property on 24-26 Los Angeles Street is said to be the first involved in the initiative – an effort to take distressed homes, renovate them, and offer them for sale to first-time homebuyers at an affordable price.
Speaking with WAMC, Fairey described the “special attorney receivership” process involved — a different take on normal receivership, where, typically, a distressed or blighted property is seized by the city to address sanitary code violations and is ultimately auctioned off to the highest bidder.
“The house passed through a receiver, who is an attorney, who stabilizes a property and then works with the owner to have it sold to a nonprofit for redevelopment,” he explained in a phone interview, describing the SAR process.
Fairey noted the Affordable Homes Act signed in August altered the state’s receivership statute under section 29, permitting courts to “allow the sale of vacant properties in receivership to nonprofits for fair market value to rehabilitate and sell affordably to income-eligible first-time homebuyers.”
According to Way Finders, most properties seized via normal receivership end up lying empty for months or years before being sold at auction – often becoming part of someone’s rental portfolio, Fairey adds.
Looking to reduce the number of home ownership opportunities lost this way, he tells WAMC the initiative came about a few years ago in collaboration with the city, local funders and a retired housing court judge, Dina Fein.
Standing beside the property on Los Angeles Street, with its windows still boarded, Springfield State Representative Orlando Ramos says the initiative is part of a broader state effort not just to address housing shortages, but put properties directly in the hands of locals – especially Black and brown communities whose homeownership rates are significantly lower.
“It is appropriate to call it a housing crisis. when you combine that with the fact that urban areas, like the city of Springfield, often times struggle with absentee landlords, and you combine that with the fact that there's a discrepancy that still exists in home ownership in the Black and brown communities… combine all of that together and this project could not be happening at a better time,” he said.
Looking over national data from 2012-2022, the National Association of Realtors says while both Black and Hispanic communities have seen an uptick in homeownership rates, that total only amounts to 44.1 and 55.1 percent, respectively, compared to white home ownership, at 72.3 percent.
Another aspect of the initiative highlighted by Springfield Ward 6 City Councilor Victor Davila – generational wealth.
“This is not a double, nor a triple - This is a home run,” Davila said of the undertaking and the Los Angeles Street house. “I think it's a homerun because in this property, you're going to have an average, between probably seven and ten people living in this property - two families. That's going to be seven to ten people off the streets. That's going to be seven to ten people who are going to benefit from generational wealth. That is truly, to me, a homerun.”
Owning or renting, Fairey has previously said Western Mass alone is looking at a potential housing shortage as big as 19,000 units by 2025. His organization, which operates across the region, has overseen the creation of over 800 units over the years, with 400 more on the way.
In the case of the City of Homes initiative, he tells WAMC there’s a focus on building momentum, with its first phase involving at least seven homes, with a goal of seeking more properties going forward.
“We're hoping that we can continue to build a model here, with money from those foundations, as well as great money from the state of Massachusetts, through the Neighborhood Stabilization Program, that will allow us to continue to do these projects well into the future,” he said.
Initial funding for the initiative dates back to 2022, and involved another $2 million from the MassMutual Foundation, as well as $1.6 million from the Massachusetts Housing Partnership, another million dollars from the city, and $300,000 from Baystate Health.
Way Finders says the work is focused on rehabilitating homes in at least six Springfield neighborhoods, mainly in the city’s northwest and center, including the McKnight, Bay and Six Corners sections.
The program, while involves a lottery system, is open to those making 80 percent of area median income who qualify for a mortgage of about $172,500.
