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City to offer $5,000 to prospective home buyers

Baltimore officials hope prospective homebuyers can be enticed with three words: Cold, hard cash.

Mayor Stephanie Rawlings-Blake plans to increase incentives for people who buy homes in Baltimore. Municipal employees will be eligible for a $5,000 loan, up from $3,000. Prospective homebuyers who attend an event called "Buying Into Baltimore" may also receive $5,000, up from $4,000.

The city forgives 20 percent of the loan each year the buyer stays in the property as his or her primary residence. After five years, the loan is forgiven.

Rawlings-Blake is scheduled to announce the increases Tuesday on the third anniversary of the "Vacants to Value" program, her effort to rehab or demolish some 16,000 vacant properties in the city.

"We're doing more of what we know works," she said. "We're providing more options for people to become homeowners."

The city hosts "Buying Into Baltimore" events twice a year. The incentives do not apply to mortgages greater than $417,000.

City Councilman Bill Henry, chairman of the council's housing committee, called the increases a smart move.

"When you're ready to sit down at settlement, every little bit helps," he said. "It's definitely going to be an assistance to people who are trying to move to Baltimore."

In three years of "Vacants to Value," the city has rehabbed 1,508 homes, given out about 500 assistance grants and demolished 727 vacant properties, officials said. On Tuesday, workers are scheduled to demolish another block in Johnston Square, to bring that total to 734. Officials say they've turned over about 800 lots for community gardens.

"We're making consistent progress," the mayor said.

The city also is launching a marketing campaign — including billboards, banners and a new website — to make people aware of the program, officials said. The mayor has set a goal of seeing Baltimore grow by 10,000 families over 10 years.

Housing Commissioner Paul T. Graziano said residents should expect to see vacant properties getting torn down at an increasing rate. Over the next 21/2 years, officials plan to spend nearly $22 million to tear down 1,500 abandoned houses. Previously, the city had spent about $2.5 million a year on demolition.

Officials plan to demolish 4,000 blighted buildings over 10 years and create green spaces in their place.

"You're going to see a dramatic increase in demolition," Graziano said. "Once a blighted property is demolished, then it's gone forever."

The city owns about 4,000 of 16,000 homes officials have identified as vacant. The U.S. Census Bureau puts the number of vacants higher, at 23,000.

As officials move to demolish blighted blocks, they must pay to relocate remaining residents. About 80 are to be uprooted this year, as the city seizes properties and reduces dozens of homes to rubble.

Graziano said it costs the city about $13,000 to tear down a home, but an average of $85,000 to relocate a renter and about $170,000 to relocate a homeowner. He said the city moves residents to more desirable neighborhoods and pays the difference for the increased rent or mortgage payment.

It's money well spent, he said, to help rid the city of that fundamental problem: the vacant house.

"We want to make sure we do the right thing for the people that live there," he said. "We find those folks are eager to move."

luke.broadwater@baltsun.com

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Copyright © 2014, The Baltimore Sun
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