Rehabbed foreclosed home on Second Avenue up for sale

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Updated: March 9, 2012 8:14AM

AURORA – The city presented plans to sell a third home that was purchased and rehabbed as part of the Neighborhood Stablilization Program at a Committee of the Whole session Tuesday night.

The city plans to sell a home at 593 Second Ave. for $105,000, according to Karen Zilly, city development coordinator.

Under the Neighborhood Stablization Program, the city accepted $3 million in U.S. Department of Housing and Urban Development funding to buy foreclosed homes in March 2009. The program was part of the federal Housing and Economic Recovery Act of 2008.

Aldermen agreed to buy the two-story home in January 2010 after it sat vacant for six months. The city purchased the home for $80,000. Original construction estimates said it would cost about $117,000 to rehab the home, according to a city memo.

The five-bedroom, three-bathroom single family home received the following exterior improvements: new windows, roof, gutters, siding and a two-car garage. The home also received a new kitchen with appliances, new bathrooms, electrical wiring, plumbing, and high efficiency furnace and water heater.

The city listed the home in May 2011 and was under contract by a previous purchaser in November, but that purchaser was unable to obtain a mortgage, according to a city memo.

The objective of the federal program was to rehab vacant properties in an effort to increase surrounding property values, according to Karen Christensen, manager of the city’s neighborhood redevelopment programs.

In addition, the purchaser’s income must not exceed 120 percent of the area median income. For a four-person household, that figure is $90,960.

The buyer will provide a minimum 3.5 percent down payment on the home, Zilly said.

Under the new homeowner agreements with the city, the buyers must occupy the home as their primary residence for five years and keep the property up to city codes in order to keep an additional 5 percent of the purchase price of the home. If they don’t, they forfeit the loan, and the amount must be repaid to the city.

The homeowner is also eligible for a grant for the closing costs on the home up to $5,000.

According to the city’s website, Aurora also has a brand-new home at 194 N. Smith St under the program. The listing price on the two-story house is $134,900.

The city sold its first house in the program, a property at 628 Bangs St., in June 2011.

The Bangs Street home, formerly a two-unit property, underwent significant renovation that cost $260,000. The house, now a four-bedroom home, sold for $130,000.

The city also sold 1044 Pearl St. for about $120,000.

According to the city website, six homes under the Neighborhood Stabilization Program will be available for purchase soon.

Under the program, homes must be vacant for at least 90 days before the city can purchase them.