Providing affordable homes

Rehab: Builders hope to use some Ellicott City residences to satisfy the new moderate-income housing law.

January 11, 2004|By Larry Carson | Larry Carson,SUN STAFF

Working families unable to afford a home in Howard County's hot real estate market may have a chance to buy a renovated residence in Ellicott City's historic district under a new county program, housing officials said.

Pending approval by County Executive James N. Robey, two units in a 100-year-old duplex being refurbished in the 8400 block of Frederick Road will be sold for $130,000 each to families earning about $35,000 a year. Two older homes on Church Road nearby are also under consideration for the program, housing director Leonard S. Vaughan told members of the Housing and Community Development Board last week.

The move represents the first use of a new law allowing builders to renovate older, run-down homes rather than build units for reduced price under the county's Moderate-Income Housing Unit law.

The Ellicott City renovation "made a lot of sense to me," Robey said. He has approved "looking into" qualifying the homes under the new law, but hasn't given the final OK, he said.

Under the law, which took effect last month, a builder can buy an older home, spend at least $50,000 on renovations and then resell it through the county to a qualified family for a pre-set "moderate" price. A government certificate issued to the renovator can be sold to a developer to satisfy laws requiring a percentage of new homes at lower prices. Only 20 percent of new moderate-income units can be fulfilled this way, although a project with fewer than five can use certificates for all such units.

The law, co-sponsored by Ellicott City Republican Christopher J. Merdon and David A. Rakes, an east Columbia Democrat, is intended to help eliminate eyesore homes that could spoil a neighborhood. It also helps scatter subsidized homes around the county, where the average price for a new house is more than $300,000.

"I think it's outstanding," Merdon said about the renovations in the Ellicott City historic district, which he represents. "I think you're going to have moderate-income units where you wouldn't have them before."

Vaughan told the housing board at a meeting Thursday night that the deal is especially helpful because it provides something in short supply in Howard.

"What we don't have is family housing," he said.

Without the law, the homes would sell at market rates. Bank appraisals put the value of the two units in the duplex at just under $200,000 each.

Jared Spahn, president of Old Town Construction, said the Frederick Road house was in such horrible shape that his workers refused to go inside and clean it until he bought full-coverage rubber suits for them.

"It was truly disgusting," Spahn said, noting he took seven Dumpster loads of trash from the two-unit home . Photos of the inside show clothing, trash, food and furniture parts strewn everywhere and trash bags piled outside.

Renovations are more than half-complete, and the three-story building with yellow siding has new kitchens and baths in addition to new plumbing, heating and cooling systems, electrical wiring, windows and doors, and walls.

"I think it's a wonderful new program. It will have a wonderful effect," said Spahn, who is also president of the Ellicott City Business Association. He expects to make a "modest" financial gain by selling the renovation certificate, he said, but wouldn't reveal an estimate.

However, a legal glitch may prevent Spahn from selling the renovation certificates to fellow Ellicott City developer Donald R. Reuwer Jr. as planned, Vaughan said. The law applies only to "future projects," and Hearthstone at Ellicott Mills, Reuwer's 35-unit townhouse project for seniors on Route 104, may be too far along to qualify. But Reuwer is not discouraged.

"I have other projects," Reuwer said, adding that he didn't expect to profit from the exchange, but he wants to see older houses improved in Ellicott City.

Nancy Rhead, a housing board member skeptical of the idea of swapping rehabbed older homes for new moderate-income units, said the Ellicott City example "has potential, and that's what we're looking for."

Jennifer Beskid, another board member who expressed doubts at the board's November meeting, said, "I think the trade-off is worth it."

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