Homeownership Zones (HOZ)

Information by State  Esta página en español  Print version  Email this to a friend   What's New HUD Recognizes Indianapolis as Model 'Homeownership Zone' City is credited with transforming 'Dodge City' neighborhood into Fall Creek Place. more... Want More Information? HOZ Allocations Copies of the NOFAs for the FY 96 and FY 97 HOZ programs are available free from Community Connections (1-800-998-9999). A HUD publication "Principles for Designing Homeownership Zones" (HUD-1996) is also available. more...

Summary:

The Homeownership Zone Initiative (HOZ) allows communities to reclaim vacant and blighted properties, increase homeownership, and promote economic revitalization by creating entire neighborhoods of new, single-family homes, called Homeownership Zones. Communities are encouraged to use New Urbanist design principals by providing for a pedestrian-friendly environment, a mix of incomes and compatible uses, defined neighborhood boundaries and access to jobs and mass transit.

Purpose:

Many inner cities and inner suburbs have large areas with blighted, under-used lots. This initiative provides Homeownership Zone grants as seed money to lower the cost of building new housing and to stimulate investment in these areas. Homeownership Zones usually consist of several hundred new homes in concentrated areas near major employment centers. There have been two competitive funding rounds, one in federal fiscal year 1996 (FY 96) and one in federal fiscal year 1997 (FY 97).

Type of Assistance:

The first HOZ competition (FY 96) awarded Economic Development Initiative (EDI) grant funds and companion Section 108 loan guarantees to six winning applicants. The second HOZ competition (FY 97) awarded recaptured Nehemiah grant funds to an additional six winners, of which five are still active.

Eligible Grantees:

Any unit of general local government.

Eligible Customers:

At least 51 percent of the homebuyers helped with HOZ funds must have incomes that do not exceed 80 percent of the HUD-determined area median income, adjusted by family size.

Eligible Activities:

FY 96 HOZ grantees must use their HOZ/EDI grant to enhance the security of their companion Section 108 guaranteed loan or strengthen the economic feasibility of projects financed with loan funds. Eligible activities include property acquisition, housing rehabilitation, site preparation and special economic development activities, including new housing construction under limited circumstances through Community-Based Development Organizations (CBDOs). FY 97 HOZ grantees may use their grant to acquire property, build or rehabilitate housing, finance site preparation, provide direct financial assistance to homebuyers, provide homeownership counseling, and construct public improvements to complement the Homeownership Zone. FY 97 grantees may also use up to 5 percent of their funds for administrative costs.

Application:

Units of general local government apply in response to a Notice of Fund Availability (NOFA) which announces the next HOZ competition.

Technical Guidance:

Homeownership Zones funded in FY 96 are governed by the regulations of the EDI program and the Section 108 program at 24 CRF 570, and the Notice of Fund Availability published in the Federal Register on July 16, 1996. Homeownership Zone grants funded in FY 97 are governed by the Notice of Funding Availability published in the Federal Register on July 28, 1997. The Office of Affordable Housing at the HUD Office of Community Planning and Development (CPD) administers the program. For more information, contact Ginger Macomber, Homeownership Zone Coordinator, 451 7th Street, SW, Washington, DC, 20410, or call (202) 708-2684, TTY 1-800-877-8339.

For program notices, go to HUDCLIPS.